Wayne A. Thorp, CFA is a vice president and the senior financial analyst at AAII and former editor of Computerized Investing. Follow him on Twitter at @WayneTAAII.


Daniel from AL posted over 4 years ago:

Fine article. The charts presenting top and bottom-performing screens for this year vs. long-term along with the detailed and unbiased analysis help put the total screening methodology in perspective.

Frank from WI posted over 4 years ago:


Khadar from AR posted over 4 years ago:

To find T ROWE PRICE SCREEN go to http://www.aaii.com/stock-screens and you will see list of stock- screens used in AAII

Benjamin from IL posted over 4 years ago:

How do I find the stocks passing the O’Neil’s CAN SLIM Screen during 2011 ?

Wayne from IL posted over 4 years ago:

We do not archive the companies that pass the screens each month because, over time, these lists become obsolete due to mergers, acquisitions, bankruptcies, name changes, etc., etc. If you are a subscriber to AAII's Stock Investor Pro program, you can access historical monthly data updates to see which companies passed a screen as of a given date. Wayne A. Thorp, CFA, AAII

Daniel from AL posted over 4 years ago:

Great analysis of the winning screen. In addition to picking winning stocks, the fact that they came in spread over the year at the right time played a huge role in the results. A big gain came in the first month of the year from owning just one stock , and then the gain was passed to the next fresh horse as it went by, compounding the gains.

Consider that if all four stocks had passed in January, and money was invested equally, the portfolio gain for the year would have been the average of the individual gains, or a "mere" 29%.

Perfect (ie,lucky) timing clearly made a huge difference in the results for this screeen.

Dave from WA posted over 4 years ago:

I would agree, using these stock screens can be hazardous to your financial health, as getting a 117% return last year is nothing more than luck - some of course will claim otherwise, as always.

As an investor what you have to be leery of is following any "scheme" that puts you too far off the market average in ANY one year.

In other words consistency is the name of the game, not chasing last years greatest thing.

I will go out on a limb here and say there is no way for a repeat performace this year - at least as a percentage above the market average. I suspect there may even be some "reversion to the mean" this year.

Britni from CA posted over 4 years ago:

Hi Wayne
Great article--thanks.

"Our backtesting methodology has each portfolio being rebalanced at the end of each month."

What is your backtesting methodology? What applications do you use to perform the backtesting?


David from OR posted over 4 years ago:

Nice analysis of the 2011 winners. You mentioned "cursory" qualitative screening after the quantitative screens. What exactly are you talking about? I have been attempting to invest intelligently but always just seem to miss the boat. I have been following the AAII stock superstars since 2005 but haven't seen the returns that it made in the past. I am looking for solid thinking. I have gotten burned by the herd.

Charles from IL posted over 4 years ago:

David, the news headlines are a good place to start; look for anything not reflected in the data that would change your outlook. I also scan through the SEC documents, particularly Form 10-K, which is the company's annual report (http://www.sec.gov/edgar/searchedgar/companysearch.html). I'm looking for anything could be good or bad (e.g. a conflict of interest between the CEO and a company he wants to acquire). I also look at the chart and make I understand why the reasons for the price movement. Finally, look for anything that explains the business model and potential risks the company may be facing. -Charles

Wayne from IL posted over 4 years ago:

We use AAII's Stock Investor Pro fundamenetal stock screening and research database program to backtest our stock screens. For information on the methods we follow to arrive at the performance figures we report, please refer to the FAQ section of the Stock Screens: http://www.aaii.com/stock-screens/faqs

Madhu from NJ posted over 4 years ago:

Dear Wayne Thorp,

A modest request. Is it possibe for AAII to develop and post O'Shaunessey 4th edition screens? Just as you have developed O'Neill revised screen, you might as well develop revised O'Schaunessey screens. I am sure you are aware of the 4th edition revised screens. All the same, for your ready reference, I am listing the three: 1. Value Factor One (made up of 1. Price-to-book 2. Price-to-earnings 3. Price-to-sales 4. EBITDA/EV 5. Price-to-cash flow.) 2. Value Factor Two (adding shareholder yield to the five factors above) and 3. Value Factor Three (substituting buyback yield for sharholder yield in Value Factor Two).

Performance based on as many as 46 years is simply phenomenal: Value Factor One: Average annual return 17.18%; Value Factor Two: 21.19; Value Factor Three: 17.39. Results of Value Factor Two are a combination of value factors AND Relative Strengh of six months. Risk is actually lower with Sharpe Ratio of 0.93. For more details, please refer to What Works On Wall Street, 4th ed., p579-591.

Sorry for such a lengthy email. In case you are too busy and cannot develop these screens in near future, can you help me in developing them?

Thanks and many thanks.

Ted from WA posted over 4 years ago:

I have the same request as Madhu. Curious whether the O'Shaunessey screens might be in the new AAII Dividend Investing service, or whether it might be available on the generally available screens.

Wayne from IL posted over 4 years ago:

I have the book sitting on my desk and hope to get to it in the coming weeks. Wayne A. Thorp, CFA, editor, Computerized Investing

John from VA posted over 3 years ago:

I would request that ya'll try to be consistent and specific when naming screens in your articles and advertisements. For example, in the July 2011 Journal inside the back cover is an ad for SIPRO. In that ad, you list six screens, but not all by the same name that appears in SIpro program. For example, you say that James O'Shaughnessy is up 29.4%. WHICH O'Shaughnessy? There are six to choose from, all quite different.

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