Adapted from the Stock Market Companion’s Investor’s Tool Kit – Power Tools Notebook …

Remember that having a handful of good ideas a year is sufficient for real growth.  (That’s what Warren Buffet mentioned in his 1991 interview with the Financial Times and put things into appropriate perspective for me.)

I have discovered one very good way to find stocks is to categorize them by price levels.

For example, have a price category in your mind of stocks ranging from $10 – $15 / share.  Watch for one or more of those stocks in this price range to jump higher in price on high daily volume (1.5x daily volume is sufficient), when the background market is suitable for  investing.  Particularly helpful is to simply look for stocks hitting new 52 week high’s, in your price catetory of – let’s say – $10 – $15 / share.

When you see the share price of a company hitting new 52 week highs in your price category, consider taking a closer look and see what is making it move (new product? Strong quarterly earnings report?…). Is it of interest for you?  Put it on your watchlist and complete an  S.I.M.P.L.E. analysis of the company.

$10 – $15 / stocks with strong, expanding earnings often move to $45 / share and beyond, when the background market and other conditions identified by the S.I.M.P.L.E. Stock Investing Method line up.