Introduction to the Cara 100
Before we trade any instrument in the market, we must decide on what we need to trade. What we need is Growth, Value and/or Income (i.e., Yield). With a huge universe of tens of thousands of companies whose shares trade daily in the market, many of which may fit into these categories, we must sort the Good Companies from the Bad Companies based on Fundamental and Quantitative analysis.
Capital market prices and Technical Indicators of Price Trends and Cycles should be unimportant factors in selecting a relatively small group of high Quality companies one must study before trading.
From a review of the Greenfield’s Cadence Decision Support System database for S&P 500 companies only, which manages over 20 data points of mostly corporate fundamental data for each company that is updated weekly, we filtered the companies into what we believe are suitable candidates for Growth, Value and Yield. The result is the production of what I refer to as the Cara 100.
Due to evolving business and economic conditions, the financial results and reporting of companies is always in flux. Hence, the Cara 100 is always a work in progress. While we recalculate our relative rankings for over 4,000 companies every weekend based on factually reported data, the Cara 100 selected from the S&P 500 will be published here at the end of every quarter.
Because of political and social developments, there are also macro-economic changes that materially affect capital market price trends and cycles of these companies. As you know from our Lessons publications, a company is not a price. We trade prices. This is a list of companies that we consider investment grade for trading purposes and is not a recommendation to buy or sell.
As market prices fluctuate, at any point in time for each of these Good Companies, there will be Good Stocks (i.e., with Trends and Cycles that are rising), and Bad Stocks (i.e., with Trends and Cycles that are falling). Each of us has our own research methodologies and trading systems. In our case, technical indicator-based algorithms help sort the difference to enable us to buy whatever it is we need to trade whenever the price is low and to sell it when the price is high. Your trading system will be different.
We hope you find value in our publishing the Cara 100 list of what we refer to as Good Companies.
Here is the list of Cara 100 Companies as at June 30, 2018