The October Scorecard - And November's Top Watchlist

[] The best stocks have strong fundamentals. You need to take a quick look at these stocks that offer strong F&Z score numbers heading into October. [View in browser]( [View in browser]( [] [Godesburg's Haven Investment Letter]( [] [Godesburg's Haven Investment Letter]( [] Dear Investor, My daughter was sick on Halloween for the third year in a row. She is four years old and has now missed Trick or Treating due to the COVID-19 shutdown, a battle with the flu, and strep throat. She doesn’t actually know what she is missing. The good news is that I didn’t have to walk the neighborhood and carry candy... That’s fortunate - as it was 95 degrees in my costume… [Wacky Inflatable Garrett]( Now… I know what you’re thinking. In fact… I really hope that you’re thinking - am I taking insight from THIS GUY - dressed like the inflatable man at the parking lot? Based on what I’m about to show you - my October F&Z score report card… I think you should. Finding Great Picks for Your Portfolio As you know, I specialize in value, momentum, insider buying, and anomaly strategies across various finance disciplines. I have a momentum indicator that I give away for free each day - a Daily indicator - that has helped time dramatic rallies and pullbacks all year. In fact, the indicator went positive in early October - just as executives loaded up on their own stocks. The blue line below is the five-day moving average of insider executive buying to executive selling by dollar amount. Click on the chart to view it larger. [Buy Sell Ratio]( Sharp upticks in this indicator typically precede rallies - as they have in late January, mid-June, mid-July, and early September. Our most recent pop came ahead of October’s rally. Let’s Take a Look at a Simple Watchlist - And The Strategy At the start of each month, I examine three unique metrics to help build a list of low-risk, high-upside stocks with rock-solid balance sheets. This is one of the most conservative strategies that I have. But it’s very good for first-time investors and options traders. That said, I know plenty of advanced traders who also love to employ this strategy in positive momentum markets. This is free. I know people who charge thousands of dollars for some of this analysis - which is silly. You just need to know how the data works, and I’m largely doing this research. Sharing it with you helps me master it. So, let’s take a look at our metrics. We have… • The Piotroski F-score • The Altman Z-score • A valuation rank Our first metric - the Piotroski F-score - gives us a clue into positive financial growth and low debt exposure. The F-score is a NINE-POINT system that rewards each company for meeting a certain criterion on its balance sheet. It was created by a Stanford and University of Chicago professor named Joseph Piotroski. If the company meets all nine criteria, it has an F-score of 9. That means its balance sheet has greatly improved year over year. Then we have the Altman Z-score. This measurement is a weighted average of five different metrics to determine whether a company might go out of business. If a company falls below 2.6, it has a risky balance sheet. That risk is tied to a balance sheet with lots of debt or weak cash flow. We are looking for stocks with a Z-score of 3 or higher. That severely reduces any credit concerns that I have. Finally, we want to add a valuation metric. Different industries require different valuation methods. So, I’m not going to share this - since it’s my secret sauce. These stocks are cheap compared to their own historical valuation and/or to their sector rivals. This is the List that We Built for October Now, look at the list below, including the metrics we had at the start of the month. There are nine names here. [October Stocks]( The gains here are solid - but not world-beating on the surface. But it’s important to understand that the best strategy around these stocks doesn’t include buying them. If you use a simple options strategy, you could have blown away the returns of the S&P 500 in October. How to Trade These Stocks If you want to start trading these great names, you don’t have to buy the stock or call options. Go deep out of the money on puts and trade credit spreads. I’ve discussed various approaches to these stocks that offer unique upside and reduced risk. Again, with these trades, you can improve your probability of profit, generate large income payments from a small position, and pick your preferred entry buying price. And what happens with these trades? If the stocks go higher, you’ll make money. You’ll make money if the stocks don’t reach the strike price. And if the stock falls to the strike price, you’ll get a great stock at a much cheaper valuation than today. It’s “win, win, win.” So, What About November? I know you’re curious about the stocks on the list for November. Here they are. [November Stocks] Tomorrow, we’ll find a trade for one or two of these stocks. I highly recommend that we focus on the energy sector (although I’m expecting a bit of a pullback/buying opportunity due to recent overbought conditions in the sector). To your wealth, [Garrett signature] Garrett {NAME} [] Market momentum is Green. The market just experienced its best month since 1976 largely on the back of short-covering and steep bets that the Fed will pivot. Despite this testing of 3,900, I don’t believe we have seen the bottom for this market. We’re staying conservative with a range of high-volatility events approaching in the Fed meeting, the October jobs report, the Midterm elections, and the Consumer Price Index report on November 10. [] [] [] Dear Investor, My daughter was sick on Halloween for the third year in a row. She is four years old and has now missed Trick or Treating due to the COVID-19 shutdown, a battle with the flu, and strep throat. She doesn’t actually know what she is missing. The good news is that I didn’t have to walk the neighborhood and carry candy... That’s fortunate - as it was 95 degrees in my costume… [Wacky Inflatable Garrett]( Now… I know what you’re thinking. In fact… I really hope that you’re thinking - am I taking insight from THIS GUY - dressed like the inflatable man at the parking lot? Based on what I’m about to show you - my October F&Z score report card… I think you should. Finding Great Picks for Your Portfolio As you know, I specialize in value, momentum, insider buying, and anomaly strategies across various finance disciplines. I have a momentum indicator that I give away for free each day - a Daily indicator - that has helped time dramatic rallies and pullbacks all year. In fact, the indicator went positive in early October - just as executives loaded up on their own stocks. The blue line below is the five-day moving average of insider executive buying to executive selling by dollar amount. Click on the chart to view it larger. [Buy Sell Ratio]( Sharp upticks in this indicator typically precede rallies - as they have in late January, mid-June, mid-July, and early September. Our most recent pop came ahead of October’s rally. Let’s Take a Look at a Simple Watchlist - And The Strategy At the start of each month, I examine three unique metrics to help build a list of low-risk, high-upside stocks with rock-solid balance sheets. This is one of the most conservative strategies that I have. But it’s very good for first-time investors and options traders. That said, I know plenty of advanced traders who also love to employ this strategy in positive momentum markets. This is free. I know people who charge thousands of dollars for some of this analysis - which is silly. You just need to know how the data works, and I’m largely doing this research. Sharing it with you helps me master it. So, let’s take a look at our metrics. We have… - The Piotroski F-score - The Altman Z-score - A valuation rank Our first metric - the Piotroski F-score - gives us a clue into positive financial growth and low debt exposure. The F-score is a NINE-POINT system that rewards each company for meeting a certain criterion on its balance sheet. It was created by a Stanford and University of Chicago professor named Joseph Piotroski. If the company meets all nine criteria, it has an F-score of 9. That means its balance sheet has greatly improved year over year. Then we have the Altman Z-score. This measurement is a weighted average of five different metrics to determine whether a company might go out of business. If a company falls below 2.6, it has a risky balance sheet. That risk is tied to a balance sheet with lots of debt or weak cash flow. We are looking for stocks with a Z-score of 3 or higher. That severely reduces any credit concerns that I have. Finally, we want to add a valuation metric. Different industries require different valuation methods. So, I’m not going to share this - since it’s my secret sauce. These stocks are cheap compared to their own historical valuation and/or to their sector rivals. This is the List that We Built for October Now, look at the list below, including the metrics we had at the start of the month. There are nine names here. [October Stocks]( The gains here are solid - but not world-beating on the surface. But it’s important to understand that the best strategy around these stocks doesn’t include buying them. If you use a simple options strategy, you could have blown away the returns of the S&P 500 in October. How to Trade These Stocks If you want to start trading these great names, you don’t have to buy the stock or call options. Go deep out of the money on puts and trade credit spreads. I’ve discussed various approaches to these stocks that offer unique upside and reduced risk. Again, with these trades, you can improve your probability of profit, generate large income payments from a small position, and pick your preferred entry buying price. And what happens with these trades? If the stocks go higher, you’ll make money. You’ll make money if the stocks don’t reach the strike price. And if the stock falls to the strike price, you’ll get a great stock at a much cheaper valuation than today. It’s “win, win, win.” So, What About November? I know you’re curious about the stocks on the list for November. Here they are. [November Stocks] Tomorrow, we’ll find a trade for one or two of these stocks. I highly recommend that we focus on the energy sector (although I’m expecting a bit of a pullback/buying opportunity due to recent overbought conditions in the sector). To your wealth, [Garrett signature] Garrett {NAME} [] Market momentum is Green. The market just experienced its best month since 1976 largely on the back of short-covering and steep bets that the Fed will pivot. Despite this testing of 3,900, I don’t believe we have seen the bottom for this market. We’re staying conservative with a range of high-volatility events approaching in the Fed meeting, the October jobs report, the Midterm elections, and the Consumer Price Index report on November 10. [] [] [] © 2022 Godesburg Financial Publishing, Inc. DISCLAIMER: COMMUNICATIONS FROM GODESBURG FINANCIAL PUBLISHING (GFP) ARE FOR EDUCATIONAL AND INFORMATIONAL PURPOSES ONLY – NOT INVESTMENT ADVICE: GFP and all the services it offers are for educational and informational purposes only and should NOT be understood to be securities-related offers or solicitations. None of GFP’s communications should be considered or used as personalized investment advice. GFP recommends that you speak with a licensed professional before making any investment decision. RESULTS PRESENTED ARE NOT NECCESSARILY TYPICAL OR VERIFIED: GFP communications may include information regarding the historical trading performance of gurus in their services (all verified by a third party), as well as testimonials of non-employees depicting profitable investments and trades that are believed to be true based on the representations of the persons providing the testimonial of their own free will. Please be aware that the claims regarding investing or trading results of non-employees are not tracked by GFP nor can they be verified. As always, past performance is not necessarily indicative of future results. Therefore, results presented in this email should NOT be considered TYPICAL. Actual results can and will vary based on everything from experience, ability, risk mitigation practices, and market volatility... to the amount of money exposed in the investment or trade. Investing and trading are speculative and carry serious risk. You may lose some, all - or possibly more - than your original investment or trade. GODESBURG FINANCIAL PUBLISHING IS NOT AN INVESTMENT ADVISOR OR REGISTERED BROKER: GFP, including its owners and employees, are NOT registered as securities broker-dealers, brokers, or any sort of registered investment advisors with the U.S. Securities and Exchange Commission, any state securities regulatory authorities, or any self-regulatory organizations. GODESBURG FINANCIAL PUBLISHING EMPLOYEES MAY HOLD SECURITIES DISCUSSED: If a writer holds any securities in a communication, it will be disclosed along with the information on the potential investment or trade. HIR, its owners or employees, have not been - or ever will be - paid by the issuer of a security mentioned in our services or communications. GFP, its owners and employees are paid entirely or in part from commissions based on sales of their services to subscribers. For more information please visit [our disclaimer page here](. [] Sent to: {EMAIL} [UNSUBSCRIBE]( [] © 2022 Godesburg Financial Publishing, Inc. DISCLAIMER: COMMUNICATIONS FROM GODESBURG FINANCIAL PUBLISHING (GFP) ARE FOR EDUCATIONAL AND INFORMATIONAL PURPOSES ONLY – NOT INVESTMENT ADVICE: GFP and all the services it offers are for educational and informational purposes only and should NOT be understood to be securities-related offers or solicitations. None of GFP’s communications should be considered or used as personalized investment advice. GFP recommends that you speak with a licensed professional before making any investment decision. RESULTS PRESENTED ARE NOT NECCESSARILY TYPICAL OR VERIFIED: GFP communications may include information regarding the historical trading performance of gurus in their services (all verified by a third party), as well as testimonials of non-employees depicting profitable investments and trades that are believed to be true based on the representations of the persons providing the testimonial of their own free will. Please be aware that the claims regarding investing or trading results of non-employees are not tracked by GFP nor can they be verified. As always, past performance is not necessarily indicative of future results. Therefore, results presented in this email should NOT be considered TYPICAL. Actual results can and will vary based on everything from experience, ability, risk mitigation practices, and market volatility... to the amount of money exposed in the investment or trade. Investing and trading are speculative and carry serious risk. You may lose some, all - or possibly more - than your original investment or trade. GODESBURG FINANCIAL PUBLISHING IS NOT AN INVESTMENT ADVISOR OR REGISTERED BROKER: GFP, including its owners and employees, are NOT registered as securities broker-dealers, brokers, or any sort of registered investment advisors with the U.S. Securities and Exchange Commission, any state securities regulatory authorities, or any self-regulatory organizations. GODESBURG FINANCIAL PUBLISHING EMPLOYEES MAY HOLD SECURITIES DISCUSSED: If a writer holds any securities in a communication, it will be disclosed along with the information on the potential investment or trade. HIR, its owners or employees, have not been - or ever will be - paid by the issuer of a security mentioned in our services or communications. GFP, its owners and employees are paid entirely or in part from commissions based on sales of their services to subscribers. For more information please visit [our disclaimer page here](. [] Sent to: {EMAIL} [UNSUBSCRIBE](