All Categories Calculations The 4 Investment Strategies

The 4 Investment Strategies

By Sean Tepper
February 17, 2021

Before we dive into the calculations, we want to provide you with an understanding of the 4 investment strategies used in the stock market.  It’s important to know each strategy and which strategy applies to TYKR.

1) Value Stock Investing:

Value stock investing is the strategy of buying On Sale stocks that are a significant discount off the intrinsic value. This is essentially what TYKR does for you automatically. In fact, it goes a step further by adding a point system (0 – 20) to the stock. The higher the points, the less risk. In fact, if you simply use TYKR to find On Sale stocks, you can make money 90% of the time.  It’s that easy.  I’ve been using TYKR to generate consistent returns ranging between 15% and 50% for five years.  The key word is “consistent”.  Overall, value investing is a very easy way to build wealth.

2) Growth Stock Investing:

Growth stocks are those companies expected to grow faster than the market average. TYKR is an excellent tool used to find Value Stocks not Growth Stocks because growth stocks can actually be classified as Speculative Stocks.  Growth stocks and speculative stocks are typically Overpriced within TYKR and it can be very hard to discern the difference between the two.  We’ll touch on speculative stocks below.  With growth stock investing, you can make 100%, 200% and sometimes 500% in one year but this is very rare.  In fact, this will only happen about 10% of the time.  For example, if you invest in 10 Overpriced stocks, you will most likely only make returns on 1.  To discern a growth stock from a speculative stock, you need to apply the 4 M’s of investing.  The 4 M’s include the MOS (Margin of Safety), Meaning, Moat, and Management.  The TYKR FAQ page describes these in more detail but to summarize, you need to have a strong understanding of the business, the industry, the future of the industry, the competition, and the management of the company to truly see if the stock is a Growth Stock or a Speculative Stock.

3) Dividend Stock Investing:

Dividend stock investing is the strategy of buying stocks with dividends and getting paid quarterly for simply holding those stocks, no matter if the share price goes up or down. You can build wealth through dividend investing but it can take a long time. By using TYKR, value stock investing will build wealth significantly faster.  In other words, earning between 15% and 50% per year is far more effective than earning a few dollars per share you hold every month.  If you are interested in Dividend Investing, TYKR does show the Dividend and Dividend Yield for each stock.

4) Speculative Stock Investing:

Speculative stock investing is where most inexperienced investors lose money. If you ever lost money in the stock market, in most cases you bought a speculative investment.  Bitcoin, marijuana stocks, and penny stocks (any stock less than $5 is classified as a penny stock) are examples of speculative investments. These investments are driven by emotions. A lot of people can fall into a FOMO (Fear of missing out) trap of trying to get rich quick but end up losing large sums of money. A great way to determine if a stock is speculative is to look within TYKR. If a stock is growing fast but is Overpriced, in most cases it’s speculative.

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