Tim, why do you talk about so many stocks in Cabot Wealth Advisory when they are at all time highs (for example, Baidu)?—A. 4/13/10

Timothy Lutts: Thank you for asking. Technically, we do not "always" recommend stocks at new highs. For example, Baidu (BIDU) was originally recommended by Cabot China & Emerging Markets Report last July, when it was trading at 320. (It's now above 620). But we do like to recommend strong stocks. We like to recommend leaders. And the fact is, especially in a bull market such as we have now, that's been going on for more than a year, the stocks most likely to be higher in the near future are the stocks that are strong now.  

That's for growth stocks.

But value investing works, too, and if that's your preference, you should consider the advice of Cabot Benjamin Graham Value Letter, which currently likes beaten-down stocks like Skywest (SKYW) and Ensco International (ESV).

Timothy Lutts
President, Chief Investment Strategist, Editor of Cabot Stock of the Month

Timothy Lutts heads one of America’s most respected independent investment advisory services, publishing eight newsletters to more than 190,000 subscribers around the world. Tim leads a dedicated team of professionals who serve individual investors with high-quality investment advice based on time-tested Cabot systems. Under his leadership, Cabot has been honored numerous times by both Timer Digest and the Hulbert Financial Digest as among the top investment newsletters in the industry. Tim also edits Cabot Stock of the Month.

Editor's Note: If you want to learn more rules for growth investors and get the top growth stock picks in the market, you should check out Cabot Market Letter. The Letter is top-ranked for both one-year and long-term market timing because it follows a finely tuned system that has been perfected during the last 40 years. Click here to find out more.

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