Sell Criteria

Sterling believes that the antithesis of what drives stock prices higher is the catalyst that can send prices dramatically lower. Accordingly, our firm's sale criteria are, roughly speaking, opposites of our purchase criteria. Whereas our purchase criteria look for stocks with strong relative price strength and accelerating earnings, our sell criteria look for exactly the opposite; issues with declining relative price strength and decelerating earnings . Relative industry price strength is also considered as a factor in sell decisions.

In addition to looking for issues with declining relative company and industry price strength, Sterling Johnston will also sell a stock if the fundamental reasons for purchase are no longer valid. Thus, a change for the worse in company financials or in the stock's 'story' or catalyst for growth will make the stock a strong sell candidate, even if it has yet to experience a drop-off in relative price strength.

Fundamental Reason for Purchase No Longer Valid