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Does the ‘Rule of 40%’ actually find growth stocks?

Ideas Farm: Venture Capitalists Love This One Investing Hack! (Or did, a few years ago).
Does the ‘Rule of 40%’ actually find growth stocks?Published on September 11, 2024

Stockpicking is hard. Finding companies with excellent prospects, secure competitive positions, effective management teams, the track records to back it up and all at a reasonable (let alone a cheap) valuation involves heaps of research, digging and reading.

So if you feel overwhelmed – or just want a place to start – a simple heuristic might be of use.

That is one way of describing the Investors' Chronicle stock screens. A quantitative approach to investing begins with a few rules, applies them to the market, and whittles down the potential avenues for research into a more manageable shortlist.

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