I have always been intrigued by stocks that made the biggest gains. My first four years as a stockbroker (1999-2002), I spent countless evenings researching the biggest winners of the past year, trying to spot trends – characteristics – the best stocks had. Not only did I want to know what caused these stocks to take off to stratospheric heights, but how I could devise a way to find the future winners beforehand.
As I did my stock research, I started to uncover secrets only the smartest minds in the money management business knew; ones they shrewdly kept to themselves. Eventually, I was able to spot the pattern — or theme — many superstar stocks possessed. It was as if they were all poured from the same mold.
Armed with this knowledge, I found one stock after another that “fit the mold” and built a portfolio compiled strictly with potential superstars. Here are the characteristics of stocks that give investors the largest gains over extended periods of time, traits of companies that fit the mold:
