Value Line Investment Survey ? Save 50% Off Your Subscription
Value Line Investment Survey is one of the most trusted source of investment ratings for institutional and individual investors.
Value Line provides many measures for each stock but its flagship rating is the Timeliness. Timeliness ranks 1700 stocks based on a combined score of Earning growth, Earning surprise and price momentum. Stocks are given a Timeliness rank between 1 and 5 with 1 being best and 5 being worst. Stocks with Timeliness rank #1 are expected to outperform the market in the next 6 months to 1 year.
A portfolio made of stocks with Timeliness rank #1 (include 100 stocks) would have you earned 14.1% from 1965 to 2005 while the S&P500 earned 6.7% during the same period. No wonder Value Line is so popular.
Now, Value Line carries a hefty price: it costs almost 600$ per year and their service is therefore not accessible to many individual investors.
How to save 50% off the Value Line subscription.
The stock market has generally performed much better during the 2nd part of the US presidential election cycle that spans over 4 years (the election taking place at the end of year 4). Here are the average returns of a portfolio made of stocks with Value Line Timeliness rank #1 over the 4 years of the presidential cycle:
Value Line Timeliness Rank #1 performances during the presidential cycle:
- Year 1: 11.7% (standard deviation: 21.1%)
- Year 2: 03.4% (standard deviation: 18.1%)
- Year 3: 31.9% (standard deviation: 16.3%)
- Year 4: 17.2% (standard deviation: 19.3%)
As you can see, it is not worth investing in Value Line in years 1 and 2 of the presidential election cycle. The reward to risk ratio is very low: risk (standard deviation) is high compared to the return. You?ll perform as well by simply investing in an index fund mirroring the market during this period, or even just going to Money Markets or Bonds. However, in years 3 and 4, then Value Line Timeliness really stands out.
Here you go: you can slash 50% off your Value Line subscription by just subscribing in years 3 and 4 of the election cycle. The next year 3 is 2007.
One more tip: many stock market strategies are highly correlated. Investing in a portfolio of stocks with Value Line Timeliness rank 1 has a correlation of 85% with the S&P500. Therefore combining Value Line strategy with most successful Market Timing systems ? such as the presidential cycle ? will work.
About the Author: Jacky Pandion is a DIY investor and founder of http://www.mechanical-investing.com. He advocates a disciplined approach to investing in the stock market. Vist http://www.mechanical-investing.com for more Stock Investing strategies including Stock Picking, Market Timing.