Long Term Investment TIPS

Below are some of the Key points to be followed while selecting the stocks for Long Term Investment

1 – Limit 5% of Total Fund:
Limit the purchase of shares in any one company to 5% of the total fund.

2 – Pay a Dividend:
The company must have been paying dividends for at least the previous 5 years.

3 – Turnover:
Turnover must be increasing year-on-year for the previous 5 years.

4 – EPS – Earnings Per Share:
Earnings Per Share must be increasing year-on-year for the previous 5 years.

5 – PE – Price to Earnings:
Price to Earnings must be between 10 and 25 for the previous 5 years.

6 – ROE – Return on Equity:
Return on Equity must be greater than 10 % year-on-year for the previous 5 years.

7 – ROCE – Return on Capital Employed:
Return on Capital Employed must be greater than 10 % year-on-year for the previous 5 years.

8 – Pre Tax Profit:
Pre Tax Profit must be increasing year-on-year for the previous 5 years.

9 – BVPS – Book Value Per Share:
Book Value Per Share must be increasing year-on-year for the previous 5 years.

10 – Free Cash Flow:
Free Cash Flow must be increasing year-on-year for the previous 5 years.

11 – Debt To Capital Ratio:
Debt to Capital Ratio must be less than or equal to 50% for the previous 5 years.

12 – Dividend History:
Divided payments must be increasing year-on-year for the previous 5 years.

13 – Daily Percent Change:
Daily Percent Change must increase per time scale.

14 – Average Daily Volume:
Must have an average daily volume of over 200,000 trades for the previous 2 years