In his book Magnet Investing (Next Decade, Inc; 2000), Jordan Kimmel, president and portfolio manager at the Magnet Investing Group, details the MAGNET stock selection process, which he says contains underlying fundamentals that are important, whether you're buying small, medium, or large cap stocks. That's because the top-performing stocks, he says, display common characteristics. The term MAGNET is an acronym that describes the following characteristics of the companies that should attract investors:
The key, Kimmel says, is recognizing that in today's market there are no sacred cows. That's why careful analysis is critical in selecting quality investments.
Careful consideration should also be given to selecting an experienced wealth advisor who is able to work in collaboration with your other financial advisors, such as an accountant or estate planner. "That coordination is the key to a successful investing plan," Moriarty says. "You wouldn't believe how many people undervalue that. What we're trying to identify for each individual investor is, for each additional percentage rate of return, how much incremental risk or volatility the investor is willing to accept. That's the key, and it's all about gaining trust with your financial and wealth advisor. It takes a little bit of time, but it's well worth the investment in the end."