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All-Star Stock Strategy: Joel Greenblatt

Joel Greenblatt is about simplicity. How else can one describe an All-Star who uses the word "little" in the title of his most prominent book and whose strategy is encapsulated in what he refers to as a "magic formula." When it comes to beating the market, simplicity is not necessarily an obstacle to beating the S&P 500. But what is the role of simplicity relative to the more complex all-star strategies?   Full Article »

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All-Star Stock Strategy: Ben Graham

When it comes to rational value investing, Ben Graham, one half the iconic Graham-and-Dodd duo, is THE All-Star, the All-Star's All-Star! He was Warren Buffett's teacher and the creator of the now-famous Mr. Market parable warning against allowing emotions to cloud one's decision-making process. He's from another generation and his approach does have a vintage feel. But applying his ideas to the present can still produce some pretty snazzy results.   Full Article »

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All-Star Stock Strategy: William O'Neil (CANSLIM)

William O'Neil did not come right out and say the CANSLIM stock-selection strategy he developed is designed to buy high and sell higher. But considering O'Neil's disdain for PE as an analytic tool and his heavy demands when it comes to growth, it's east to see why one might assume he said it. Intellectually speaking, that would outrage many. Interestingly, though, the model we developed based on our application of CANSLIM (with no reference to PE or any other valuation metric) performed quite well, even during bearish periods, enough so to merit a look even by those who usually shun high valuations.   Full Article »

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All-Star Stock Strategy: Warren Buffett

Warren Buffett is often cited as the penultimate value investor. It is true that Buffett is very sensitive to how much he's being asked to pay for shares. But there's a lot more to what he does than value. He cares very deeply about the nature of the company itself, apart from how the market values it shares. And when it comes to companies, he likes financial stability, good management, etc. as much as anyone. But what really sets Buffett apart is his quest for understandability, leading to predictability.   Full Article »

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All-Star Stock Strategies: Background

Brand names . . . we buy them all the time. We do it with food. We do it with clothing. We do it with personal care products. We do it with electronic products. Etc., etc., etc. Many also like to do it with investing strategies. In this latter arena, the brand names refer to people; famous investors whose portfolios have performed well over prolonged periods and who have garnered the respect and admiration of large segments of the investing community. The "products" are strategies that aim, to the extent practicable, to mimic their methods.   Full Article »