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Using The Chowder Rule To Filter Stocks

How do you find the next investment to purchase? How do you decide which holding to add to?

I personally like to maintain a certain diversification ratio and use that to select a sector that need to be adjusted but then I am left with picking a stock in that sector. Using my list of stocks, I go through the stocks in the sector and try to identify the best pick. I like to ensure the company has good dividend growth and I am now using the Chowder Rule in this process with one slight twist in that I am using the lowest dividend growth of the 3, 5, or 10 year CAGR dividend growth.

Let me know what your process is and the key metrics that matters. I try to restrict my portfolio to 40 stocks or less to avoid building my own index.