Large Cap Share Buyback Model
INVESTMENT OBJECTIVE
The iQ Large Cap Share Buyback Model seeks capital growth by investing primarily in common stocks of large domestic corporations that have engaged in a share repurchase program in the previous twelve months.
PROCESS
The iQ Large Cap Share Buyback Model employs the following unemotional rules-based process:
Start with the largest 500 domestically-traded companies
Select the 100 companies with the highest 12-month share buyback ratio.
Screen by Value, Momentum and 5-year Beta and select the top 30
Screen by risk-adjusted price momentum and select the top ten.
This model reconstitutes every February, May, August and November
Why invest in large-cap share buyback stocks?
Investing in large-cap share buyback stocks can provide a number of benefits to investors. First, companies that engage in share buybacks are essentially signaling to the market that they believe their stock is undervalued, and that they are committed to returning value to shareholders. This can boost investor confidence and drive up the stock price.
Additionally, companies that engage in share buybacks often have strong balance sheets and cash flows, which can make them attractive investments for income-seeking investors. Share buybacks can also boost earnings per share (EPS), which can make the company more attractive to investors who focus on earnings growth.
Large-cap companies are typically more established and have a proven track record of success, which can make them less risky investments compared to smaller companies. They also tend to have more liquidity, which can make it easier to buy and sell their shares.
Overall, investing in large-cap share buyback stocks can be a smart way for investors to gain exposure to established companies that are committed to returning value to shareholders, while potentially benefiting from stock price appreciation and income generation.
Please note that investing in large-cap share buyback stocks involves inherent risks, and their performance may not always align with expectations. Share buybacks can impact a company's financial health, capital structure, and future growth potential. While buybacks can enhance shareholder value by reducing outstanding shares, they may also signal a lack of investment opportunities or strategic growth initiatives. Past performance of large-cap share buyback stocks should not be considered indicative of future results, as market conditions, economic factors, and other variables may influence outcomes. Investors should carefully evaluate their risk tolerance, financial objectives, and consult with a qualified financial professional before making investment decisions. It is essential to conduct thorough research and due diligence to understand the implications and risks associated with investing in these stocks. Please remember that all investments carry inherent risks, and there is no guarantee of returns.