VTX Capital Active Investment Research: Our Best Stock Picks

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activeThere are thousands of publicly traded stocks out there for investors to choose from.  The way our team sees it- there's a vast sea of opportunities out there for some truly special stocks, if you know where to look.  The only problem is that finding these hidden gems isn't easy.  It takes a lot of time, effort, and skill– and rarely do “Do-It-Yourself” investors have all three of those key elements.

This is why many choose to use index funds to build their portfolio.  Using passive funds alone takes very little time, effort, and skill.  And for investors who don't have any interest in diving in deeper, this is a perfectly fine approach.

The only downside to using index funds alone is that you miss the chance to find and make focused investments in the one-of-a-kind companies that can have a huge impact on your portfolio.  We believe that the most optimal portfolios include passive index funds and some thoroughly vetted individual stocks.  Holding some concentrated positions in even just a handful of companies can drastically increase your potential returns.

The VTX Capital Stock Selection Process

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Collaboration:  Our process begins with an open dialogue between all members of the Research Team.  Our analysts each specialize in different areas, so combining perspectives is an important step for defining the team's overall outlook.

Ideas: The goal of the Idea Phase is to translate our perspective of domestic and international macro conditions into an opinion on which sectors and industries have strong potential to outperform in the future.

Screening: Within the confines of the previous step, we use a proprietary screening system that sifts through stocks based on predetermined fundamental data.  We then further filter down our findings using a mix of momentum-based technical indicators.

Final Vetting:  With the final list of candidates, our Senior Analysts perform deeper due diligence on each company.  We focus particularly on shareholder reports, management audits, and forecasting any upcoming catalysts for each company.

Five New Stocks Each Month

At the beginning of each month, we publish our single best stock for each of the following 5 categories below.  These are stocks that our research has shown as having the biggest upside potential and the best risk/reward ratio.


Small Cap
Our pick for this category is often a stock that hasn't had much coverage in the mainstream financial media, and perhaps isn't yet being covered by Wall St. analysts.  Small cap stocks are where the greatest opportunities lie, but they also carry the most risk.  Often times the stock pick for this section will have a positive news catalyst on the horizon that could drive up value.
Mid Cap
Our mid-cap pick is typically a stock that has a perfect blend of both value and growth characteristics- meaning our aim is to identify a company with the stability of a large-cap but the growth potential of a small-cap
Large Cap
The focus in this category is the find a stable, well established company that is fundamentally undervalued.  Most large-caps have stood the test of time in their industry, which means they can be a highly profitable investment over the long term (especially when purchased at a discount).  
International
Sometimes the best opportunities in the stock market exist outside of the U.S.  We dedicate one stock pick each month to an international company that has potential to make big waves in its industry over the coming months and years.  
Dividend Payer
This monthly pick goes to a high quality growth stock with a history of paying dividends as well as consistently increasing them.  Capital appreciation in still a central focus of this category, despite the emphasis put on dividends.  Yes, it's possible to find stocks that accomplish both.

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Jeff Proctor

Hi there! I'm Jeff. I started VTX with Ben after working in professionally in the personal finance field for almost 3 years.

You'll usually see me on here writing articles about how to save (and make!) money, how to make smarter investment choices, and how to have a better overall financial life. If there's ever a topic you'd like to see me cover, shoot me an email!
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One comment

  1. Interested to hear more about this Jeff! Sure I’ll come across it reading through your archive articles. Sounds good to me and I’ve realised that your dogs name resonates with me being from Sydney, Aus 🙂

    Cheers

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