They have below average Relative Value ratings, but are above average in Relative Safety. These steady, predictable stocks seldom receive a Sell recommendation. Investor buying Conservative stocks will experience low turnover, and low commission costs. Generally, however, they will also experience below average portfolio performance. Dividend Yield in Percent.
Prudent stocks offer above average capital appreciation potential along with above average safety.
Investors buying Prudent stocks tend to hold them for the long-term, but also sell lackluster performers to improve profits. Therefore, their turnover is somewhat higher than a Conservative investor's, but their portfolio's performance is much better. The use of Stop-Sell prices is advocated strongly when managing stocks with Relative Safety ratings of less than 1.00. Portfolio turnover and commission costs can be substantial, but so can the profits. Speculative stocks are extremely volatile and demand close scrutiny and frequent trading.