No. of Recommendations: 16
Jim, would you expand a bit? - trade/refresh how?

The goal is just to avoid following a dying company down into the grave.
Any system you devise that would have got you out of Kodak would probably be fine.

The death phase tends to be a small number of very bad (and obviously bad) years for the company's business economics and, usually, price and market cap.
On average, the death watch tends to be a relatively short stretch of a firm's otherwise long and fruitful life.

It seem to me that the way to avoid losses from the "hold till death" phase is merely to check once in a
while that the things you currently own aren't are their way there, and replace those that seem that they might be.

There are probably lots of different ways to accomplish this. Any half way plausible check for investibility would probably do.
Continued index membership.
Continued membership in the set of "most profitable N firms".
Membership of the Value Line set.
ROE still over a given modest threshold.
Or crowd source it: ratio of price to 52 week high still among the top 90% of stocks.
Dying firms seem to percolate to the worst 10%.

Many good old MI screens start with a few "crap filters".
Just don't hold stocks that fail those tests.
If you merely eliminate a few big losers, it's amazing how much a portfolio's long run returns improve.

Jim
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