Introduction to the Cara 100
Investment simply means the act of buying and selling of a monetary asset such as cash, precious metals, stocks, bonds, exchange traded funds and mutual funds. We invest money in these assets either for income or capital appreciation based on our analysis of lowest risk-highest potential reward. The prices of monetary assets are in constant flux, so there is always a matter of speculation in making buy and sell decisions, but there is a major difference between speculation and investment.
It has always been my belief that to invest in an asset, we must study and understand the asset, which requires an understanding of fundamental and quantitative analysis, which in turn requires a company to study rather than a pool of companies held by a fund.
Before we trade the securities of a company, we must understand that analysis will show that there are relatively good companies (lowest risk) and bad companies (highest risk). There are many companies held by a fund, which means that when we buy shares of a fund we are speculating. Moreover, we must also appreciate that a fund holds investments in some bad companies, which is counter to the reason we invest.
To help investors in selecting a relatively small group of high-quality companies to study. I created the Cara 100 list. The components usually, but not always, are industry leaders in corporate fundamentals like balance sheet strength and operating performance like cash flow, margins, earnings, and possibly dividends. This list is free of the business and personal biases of sell-side investment analysts.
Due to evolving business and economic conditions, the financial condition and operating performance of companies is always in flux. Hence, the Cara 100 is always a work in progress. Because there are tens of thousands of companies whose shares trade on various stock exchanges, I selected the Cara 100 from the S&P 500 index components, each of which trades on a major US exchange. The S&P 500 index represents the largest investable pool of company stocks in the world. To monitor relative performance I am now developing a Cara 100 index, noting that like the S&P 500, there will be changes over time made to the Cara 100.
As of October 31, 2020, this is the Cara 100 list of company stocks at finviz.com:
https://finviz.com/screener.ashx?v=111&t=A,AAPL,ABC,ABMD,ACN,ADBE,ADI,AJG,AKAM,AL,ALGN,AMAT,AMD,AMED,AMGN,AMZN,APD,APH,ASGN,ATVI,AVY,AXP,BAX,BBY,BCC,BLD,BLK,BMY,BSX,CACI,CDNS,CHE,CNC,COST,CPRT,CRSP,CRUS,CSCO,CVX,DAVA,DG,DIS,DOV,EA,EL,EPAM,EQIX,EW,EXPO,FB,FCX,FLT,FSS,FTNT,GOOG,HON,HUBB,ICE,IDXX,INFO,INTC,ISRG,JNJ,KEYS,LHX,LLY,LMT,LOW,LRCX,MA,MCO,MNST,MPWR,MRNA,MRTN,MSFT,MU,NEM,NFLX,NOC,PEP,PYPL,QCOM,REGN,SNPS,SPSC,SWKS,TDY,TFX,TJX,TSCO,TTWO,TYL,ULTA,UNH,UPS,V,VEEV,VRTX,WST&r=81
The Cara 100 is a list of companies that we consider investment-grade for trading purposes but is not a recommendation to buy or sell. There are always times to buy and sell, and in order for a trade to occur, the buyer and the seller must agree on those times.
As you know from our blog and our Lessons publications, a company is not a price. We trade prices and seek to find the best times to buy and sell these fluctuating prices. Political and social developments in the world are constant and result in macro-economic changes that cause price fluctuations in all securities. Over time, price motion in market prices impacts the trends and cycles of these securities. I trade at times that I perceive there are reversals in price trends and cycles.
We hope you find value in our Cara 100 list of Good Companies. But, as market prices fluctuate, at times these Good Companies will also be Good Stocks (i.e., with Trends and Cycles that are rising), and at times they will be Bad Stocks (i.e., with Trends and Cycles that are falling). So investing requires price and volume technical analysis. In my practice, I buy at times the price is low and sell when the price is high. Your trading system may be different. For example, you may buy high, especially on breakouts from a recent trading range, and sell higher, at a profit.
Suffice to say that each of us has our own research methodologies and trading systems. However, do not ignore the fact that successful investing is a matter of finding and understanding good companies (such as the Cara 100) and then trading the good stocks among those good companies
Here is the full excel file of Cara 100 Companies as at October 31, 2020
| Ticker | Company | Sector | Industry |
| A | Agilent Technologies, Inc. | Healthcare | Diagnostics & Research |
| AAPL | Apple Inc. | Technology | Consumer Electronics |
| ABC | AmerisourceBergen Corp | Healthcare | Medical Distribution |
| ABMD | Abiomed, Inc. | Healthcare | Medical Devices |
| ACN | Accenture plc | Technology | Information Technology Services |
| ADBE | Adobe Inc. | Technology | Software – Infrastructure |
| ADI | Analog Devices, Inc. | Technology | Semiconductors |
| AJG | Arthur J. Gallagher & Co. | Financial | Insurance Brokers |
| AKAM | Akamai Technologies, Inc. | Technology | Software – Infrastructure |
| AL | Air Lease Corp | Industrials | Rental & Leasing Services |
| ALGN | Align Technology, Inc. | Healthcare | Medical Devices |
| AMAT | Applied Materials, Inc. | Technology | Semiconductor Equipment & Materials |
| AMD | Advanced Micro Devices, Inc. | Technology | Semiconductors |
| AMED | Amedisys, Inc. | Healthcare | Medical Care Facilities |
| AMGN | Amgen Inc. | Healthcare | Drug Manufacturers – General |
| AMZN | Amazon.com, Inc. | Consumer Cyclical | Internet Retail |
| APD | Air Products and Chemicals, Inc. | Basic Materials | Chemicals |
| APH | Amphenol Corp | Technology | Electronic Components |
| ASGN | ASGN Inc. | Industrials | Staffing & Employment Services |
| ATVI | Activision Blizzard, Inc. | Communication Services | Electronic Gaming & Multimedia |
| AVY | Avery Dennison Corp | Industrials | Business Equipment & Supplies |
| AXP | American Express Co | Financial | Credit Services |
| BAX | Baxter International Inc. | Healthcare | Medical Instruments & Supplies |
| BBY | Best Buy Co., Inc. | Consumer Cyclical | Specialty Retail |
| BCC | Boise Cascade Co | Basic Materials | Lumber & Wood Production |
| BLD | TopBuild Corp. | Industrials | Engineering & Construction |
| BLK | BlackRock, Inc. | Financial | Asset Management |
| BMY | Bristol-Myers Squibb Co | Healthcare | Drug Manufacturers – General |
| BSX | Boston Scientific Corp | Healthcare | Medical Devices |
| CACI | CACI International Inc | Technology | Information Technology Services |
| CDNS | Cadence Design Systems, Inc. | Technology | Software – Application |
| CHE | Chemed Corp | Healthcare | Medical Care Facilities |
| CNC | Centene Corp | Healthcare | Healthcare Plans |
| COST | Costco Wholesale Corp | Consumer Defensive | Discount Stores |
| CPRT | Copart, Inc. | Industrials | Specialty Business Services |
| CRSP | CRISPR Therapeutics AG | Healthcare | Biotechnology |
| CRUS | Cirrus Logic, Inc. | Technology | Semiconductors |
| CSCO | Cisco Systems, Inc. | Technology | Communication Equipment |
| CVX | Chevron Corp | Energy | Oil & Gas Integrated |
| DAVA | Endava plc | Technology | Software – Infrastructure |
| DG | Dollar General Corp | Consumer Defensive | Discount Stores |
| DIS | The Walt Disney Co | Communication Services | Entertainment |
| DOV | Dover Corp | Industrials | Specialty Industrial Machinery |
| EA | Electronic Arts Inc. | Communication Services | Electronic Gaming & Multimedia |
| EL | The Estee Lauder Companies Inc. | Consumer Defensive | Household & Personal Products |
| EPAM | EPAM Systems, Inc. | Technology | Information Technology Services |
| EQIX | Equinix, Inc. (REIT) | Real Estate | REIT – Specialty |
| EW | Edwards Lifesciences Corp | Healthcare | Medical Devices |
| EXPO | Exponent, Inc. | Industrials | Consulting Services |
| FB | Facebook, Inc. | Communication Services | Internet Content & Information |
| FCX | Freeport-McMoRan Inc. | Basic Materials | Copper |
| FLT | FLEETCOR Technologies, Inc. | Technology | Information Technology Services |
| FSS | Federal Signal Corp | Industrials | Pollution & Treatment Controls |
| FTNT | Fortinet, Inc. | Technology | Software – Infrastructure |
| GOOG | Alphabet Inc. | Communication Services | Internet Content & Information |
| HON | Honeywell International Inc. | Industrials | Specialty Industrial Machinery |
| HUBB | Hubbell Inc. | Industrials | Electrical Equipment & Parts |
| ICE | Intercontinental Exchange, Inc. | Financial | Financial Data & Stock Exchanges |
| IDXX | IDEXX Laboratories, Inc. | Healthcare | Diagnostics & Research |
| INFO | IHS Markit Ltd. | Industrials | Consulting Services |
| INTC | Intel Corp | Technology | Semiconductors |
| ISRG | Intuitive Surgical, Inc. | Healthcare | Medical Instruments & Supplies |
| JNJ | Johnson & Johnson | Healthcare | Drug Manufacturers – General |
| KEYS | Keysight Technologies, Inc. | Technology | Scientific & Technical Instruments |
| LHX | L3Harris Technologies, Inc. | Industrials | Aerospace & Defense |
| LLY | Eli Lilly and Co | Healthcare | Drug Manufacturers – General |
| LMT | Lockheed Martin Corp | Industrials | Aerospace & Defense |
| LOW | Lowe’s Companies, Inc. | Consumer Cyclical | Home Improvement Retail |
| LRCX | Lam Research Corp | Technology | Semiconductor Equipment & Materials |
| MA | Mastercard Inc. | Financial | Credit Services |
| MCO | Moody’s Corp | Financial | Financial Data & Stock Exchanges |
| MNST | Monster Beverage Corp | Consumer Defensive | Beverages – Non-Alcoholic |
| MPWR | Monolithic Power Systems, Inc. | Technology | Semiconductors |
| MRNA | Moderna, Inc. | Healthcare | Biotechnology |
| MRTN | Marten Transport, Ltd. | Industrials | Trucking |
| MSFT | Microsoft Corp | Technology | Software – Infrastructure |
| MU | Micron Technology, Inc. | Technology | Semiconductors |
| NEM | Newmont Corp | Basic Materials | Gold |
| NFLX | Netflix, Inc. | Communication Services | Entertainment |
| NOC | Northrop Grumman Corp | Industrials | Aerospace & Defense |
| PEP | PepsiCo, Inc. | Consumer Defensive | Beverages – Non-Alcoholic |
| PYPL | PayPal Holdings, Inc. | Financial | Credit Services |
| QCOM | QUALCOMM Inc. | Technology | Semiconductors |
| REGN | Regeneron Pharmaceuticals, Inc. | Healthcare | Biotechnology |
| SNPS | Synopsys, Inc. | Technology | Software – Infrastructure |
| SPSC | SPS Commerce, Inc. | Technology | Software – Infrastructure |
| SWKS | Skyworks Solutions, Inc. | Technology | Semiconductors |
| TDY | Teledyne Technologies Inc. | Technology | Scientific & Technical Instruments |
| TFX | Teleflex Inc. | Healthcare | Medical Instruments & Supplies |
| TJX | The TJX Companies, Inc. | Consumer Cyclical | Apparel Retail |
| TSCO | Tractor Supply Co | Consumer Cyclical | Specialty Retail |
| TTWO | Take-Two Interactive Software, Inc. | Communication Services | Electronic Gaming & Multimedia |
| TYL | Tyler Technologies, Inc. | Technology | Software – Application |
| ULTA | Ulta Beauty, Inc. | Consumer Cyclical | Specialty Retail |
| UNH | UnitedHealth Group Inc. | Healthcare | Healthcare Plans |
| UPS | United Parcel Service, Inc. | Industrials | Integrated Freight & Logistics |
| V | Visa Inc. | Financial | Credit Services |
| VEEV | Veeva Systems Inc. | Healthcare | Health Information Services |
| VRTX | Vertex Pharmaceuticals Inc. | Healthcare | Biotechnology |
| WST | West Pharmaceutical Services, Inc. | Healthcare | Medical Instruments & Supplies |