From mid-August this year, I’ve been running a little paper portfolio using the StockRanks as an experiment. I threw it together out of curiosity at first, not putting much work into it and the whole process taking no more than about 15 minutes. I have been pleasantly surprised by it all so far though so I thought I’d share the progress and my thoughts to date.The process…First off, I will outline the strategy itself and a few details as to how the portfolio is constructed etc. Sadly, I have played with the screen a little since formation date so can’t remember the exact criteria used but, roughly, they were as follows:StockRank over 90 (that’s the QVM part!)
EV/EBITDA gt; 60% of the sector (to satisfy my bias towards value)
Dividend yield gt; 60% of the sector (who doesn’t like a little income?)
Piotroski F-score gt;=7 (to angle towards fundamental momentum)
Market cap gt; £10m (to avoid the real tiddlers)
Market cap lt; £1000m (to avoid those sluggish large caps)
That’s about it, my apologies if it’s not 100% accurate but it was something very close to that. I realised, in retrospect, that some of these criteria are unnecessary really, for example the EV/EBITDA and dividend yield…
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