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KEY TERMINOLOGIES
Email and Twitter Action Alert: Completing a buy or sell in the market. When we issue an alert that indicates that we have identified a low or high valuation that we are acting upon. A low valuation indicates a stock that is in the buying zone, a high valuation indicates a stock that is in the selling zone. You may use these alerts to help you decide whether you should buy or sell a stock.
Track Record: The track record that John and his clients have had since the beginning of PurpleChips.com in 2012. These are real trades that have been completed and not paper trades.
Holding Period: This refers to the period that we expect to hold a stock before it reaches our target price. At Purple Chips, we usually expect to hold a stock for 18 months before it reaches our target.
Stock Highlighting Colors
Green: A stock at or below its low valuation
Light Green: A stock within 5 % of its low valuation
Red: A stock at or below its high valuation
Light Red: A stock within 5 % of its high valuation
Watchlist: This is the list of Purple Chip stocks that you have chosen to monitor.
Top 20: These are the top US stocks out of all the US listed Purple Chip stocks. They were chosen because they have the best earnings performance when compared against all other Purple Chip stocks.
Top 8: These are the top TSX listed stocks out of all the TSX listed Purple Chip stocks. They were chosen because they have the best earnings performance when compared against all other Purple Chip stocks.
Valuation Range: The range between a stock’s low valuation (indicating the buying zone) and it’s high valuation (indicating the selling zone).
Winners: Stocks that we owned that we sold at a profit.
Company Symbol: This is also known as the ticker symbol. Often a 3 or 4 letter code for a stock. Example: Microsoft goes by the ticker symbol MSFT.
Position Size: Position size is the percentage that we allocate to a certain stock. This is based on how much you allocate to stocks out of your total portfolio. For example, if your portfolio has $1,000,000 of which you have $300,000 in fixed income (bonds) and $700,000 in stocks, then 100% of your equity allocation is equal to $700,000. A 5% position would be equal to 5% of $700,000 or $35,000. At Purple Chips, 5% positions are referred to as Full positions (which are the size of positions that we take for stocks that pay dividends) and half positions are 2.5%, for stocks that do not pay dividends.