The Motley Fool Discussion Boards
Canadian Investing / Canada - Microcaps
|Subject: Flare-out Growth 1 yr Cdn port||Date: 2/5/2000 8:48 PM|
|Author: Jacko2||Number: 967 of 3296|
The folks over at http://investor.msn.com have developed a number of strategies. One of these is called "Flare-out Growth" (FOG, for short), a large-cap momentum-based strategy, that comes in yearly traded and monthly traded ports. The FOG port for 1999 was up over 200%, but the monthly one was down about 28% in Jan 2000.
I don't know what backtesting they've done. The screening criteria apparently come from a book called "Online Investing", carried by Barnes & Noble.
You buy the top 4 stocks that meet the criteria. At the moment, the yearly screen at investor.msn pulls up mostly the fiber optic stocks (Harmonic, and so on).
The criteria for the yearly traded port are:
1. Market cap >= US$1B
2. 12 mo rev >= US$10M
3. price/sales >= 4
4. % price change over last month >= 1%
5. % pr chg over last quarter >= 10%
6. % pr chg over last year >= 100%
7. % pr chg yr - % pr chg Q - (3 * % pr chg mo) = as high as possible
I interpret the criteria as finding relatively large companies, with some but not a lot of revenue, that seem relatively expensive (though because higher p/s ratios can be supported by healthy net margins, p/s can be a proxy for profitable comp