A higher score indicates a higher quality of business. If a company has a Jitta Score of over 5 every year, it means that that company is better than average.
The range of Jitta Score can be categorized into:
- Jitta Score 5-7: Good business
- Jitta Score 7-8: Very good business
- Jitta Score 8-10: Excellent business
When to buy stocks should follow these principles:
- Jitta Score more than 7 should be bought under the Jitta Line.
- Jitta Score between 5 to 7 should buy under the Jitta Line at least 20%.
Jitta Score between 5 to 6 should not be a long term investment because its business is not good enough to make a high profit from holding in the long term. Thus, investors should buy under the Jitta Line and sell over the Jitta Line.
For Jitta Score more than 7, it should be a long term investment. You should buy at a fair price, and hold until the Jitta Score is below 7 or the Jitta Line extreme falls. A good quality stock is predictable to be cash cow stock, which is consistently profitable business.