• Stock Screens
  • 2013 Stock Screens Review: The Year of the Bulls

    by Joe Lan, CFA

    As we approach another calendar year end, I can’t help but reflect on what an incredible year it’s been for the stock market.

    Coming into this year, analysts were hoping for a positive 2013, but did not really know what to expect. Unemployment was still stubbornly high and, in addition, our economy was facing the possibility of across-the-board tax hikes in conjunction with automatic spending cuts, or sequestration. If you asked me then what the chances of the S&P 500 index gaining more than 25% for the year were, I would have said slim to none, leaning more toward none.

    Now, as I am writing this, the major U.S. market indexes have all gained more than 25%, and we are merely a few weeks away from the end of the 2013 calendar year. The market has been in an upward trend for the entire year, with just some minor pullbacks. Market pullbacks during the year were almost always due to two specific reasons: weakness in the global economy, especially from a slowdown in emerging markets; and worries over the potential tapering of U.S. government stimulus measures. These concerns were at the forefront when the market dipped in mid-May. However, after concerns over tapering were alleviated, stocks began rallying again. In October, the market took another breather as the government “shut down” for 17 days due to our politicians’ inability to hammer out a nonpartisan budget deal. However, stocks were able to rebound once again shortly after the crisis was resolved.

    Looking forward, one cannot help but wonder what is in store. The S&P 500 and Dow Jones industrial average have both rallied to all-time high levels, while the NASDAQ has once again broken 4,000 (the NASDAQ is still significantly lower than it was during the dot-com boom, showing how incredibly rich tech firms were during that time). While I will not make any specific predictions, it is prudent to keep in mind that our economy has been growing with an extended period of unprecedented economic stimulus. It will be telling to see how the economy responds to the tapering of the bond-buying program and, eventually, the raising of interest rates. Federal Reserve Chairman Ben Bernanke has stated that the Fed is not looking to raise interest rates until unemployment drops to 6.5%, but I would be shocked to see the current near-zero interest rate maintained if inflation starts to take off before unemployment hits that level.

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    Joe Lan, CFA is a former financial analyst for AAII.


    Discussion

    L Barnette from WA posted over 2 years ago:

    table won't load - running Windows 7


    L Barnette from WA posted over 2 years ago:

    TABLE 1 WOULD NOT DOWNLOAD [USING WINDOWS 7 ON DELL DESKTOP]


    D Seyk from CA posted over 2 years ago:

    table will not load Using Windows 7


    D Seyk from CA posted over 2 years ago:

    go to the printable version for the complete article including the table


    Jean Henrich from AAII posted over 2 years ago:

    There is currently a glitch that occurs when opening Table 1 using the Microsoft Internet Explorer browser. We apologize for the problem and are working on a remedy. In the meantime, we are adding a direct link to download an Excel spreadsheet of the table. And, as D. Seyk noted, you can also click on "download printable PDF" under Print This Article on the left side of the page near the third paragraph of text. This will open the printed pages version of the entire article, which you can view onscreen or print.
    -Jean, AAII


    Raymond Zirkle from GA posted over 2 years ago:

    Click on the link in the print box to open the entire table. I did this on my I Pad. You can print then entire table then.


    Jeff Goodwin from CA posted over 2 years ago:

    re: Table 1

    Using Firefox w/ linux, I get error message saying I need to allow a cookie - I'm not interested in finding out which one I have blocked but for those who want a cause, you may check it out.

    Jeff G.


    John Hawkins from MD posted over 2 years ago:

    I have a MacBook Air notebook which uses the Safari browser. I tried loading table one but was unsuccessful even after clicking the "allow" button on my preferences.


    John Hawkins from MD posted over 2 years ago:

    I have a MacBook Air notebook which uses the Safari browser. I tried loading table one but was unsuccessful even after clicking the "allow" button on my preferences.

    Update: I paged back and tried to look at table one again. This time it worked !! Sorry for the above alarm.


    Kenneth Duhy from FL posted over 2 years ago:

    Are the screens updated on a regular basis? If so what dates are they updated. I not that the current date is Sept. 30 - 90 days ago, not very current.


    Werner Emmerich from PA posted over 2 years ago:

    Everybody seems worried about the Tables. Many of the portfolios listed have been known for years to do well or badly. If you have been a member even for a short time and do your homework, you already know what's going on.


    Jean Henrich from IL posted over 2 years ago:

    Performance of the AAII Stock Screens is updated once a month on the 15th of the month. Sign up to receive email notification at www.aaii.com/email. Data shown here is as of November 30 - the most current month-end data we had at the time the article went to press.

    -Jean, AAII


    James Bowen from OR posted over 2 years ago:

    This article does not delve into the true risks of investing in these stock screen portfolios. As a result, it does more disservice than positive service to the individual investor. I view this article more as a marketing effort to sell the stock screening program than as a true unbiased analysis of the pros and cons of each stock screen. Many of these stock screen portfolios suffer from a extremely limited number of stocks in the portfolio as well as thinly traded and volatile stock selections. Even the Investors Business Daily has used the performance of the stock screens as a marketing tool to sell their newspaper. The O'Neil stock screens deviate significantly from real O'Neil formula that they cannot be realistically be compared. When will AAII give us an unbiased analysis of these stock screens? Not any time soon, if it means lower sales of the stock screening program or AAII membership fees.


    Paul Livingston from Florida posted over 2 years ago:

    As a new member, I question why look at these other stock screens and why weren't the AAII shadow portfolio and the AAII mutual fund portfolio included in the table?


    Jeffrey Hayes from CO posted over 2 years ago:

    Why is the Lowell Miller stock screen not among the stock screens covered (mentioned in the June 2013 AAII issue)?


    Gene Falck from MD posted over 2 years ago:

    I am new to AAII. I just read the article (email) by Charles Rotblut about the Momentum Stocks with Low Prior-Year Valuations. It seems the point was to delay buying any of the stocks listed until 1 year after they pass the screens he used. Reviewing the list, I made a comparison between buying the list of stocks in Feb, 2013 vs at the low point between then and now. The average difference I come up with was about 17%: the raw average gain of all 25 stocks listed was 61% if bought in Feb, 2013 and 79% buying at the low point. However, I expect nobody could even come close to buying each stock at the low point - so is my thinking clear that there is no real benefit to waiting?

    Next questions: Are the stock screens he used available to us lowly investors? Do I have to subscribe to Stock Investor Pro in order to get to the stock screens he used?


    Charles Rotblut from IL posted over 2 years ago:

    Hi Gene,

    I used Stock Investor Pro to create the screen I discussed in my Investor Update newsletter. It is a custom screen that does not exist on AAII.com.

    You will need Stock Investor Pro to recreate the screen, but you will also have the advantage of customizing the screen as you see fit.

    -Charles


    Gene Falck from MD posted over 2 years ago:

    Thank you, Charles.


    Cora from AB posted over 2 years ago:

    What Canadian Exchange you have included in your data base (how many Canadian stocks)


    J Landry from LA posted over 2 years ago:

    Will the stock screens be online one day so that we don't have to download at the end of every month? Thanks


    Vaidy Bala from AB posted over 2 years ago:

    I have an Apple Desktop Leopard computer. I have difficulty printing the Table. Second, there are some 75 screens, it is not clear why so many? To confuse the novice investor. What are the limitations of each as some member pointed out. Are these screens available to the AAII member, routinely. You suggested, not to use many, but some in diversified sectors, this is not clear as to how to apply this statement. I am new to the screens game, and hence the questions. I will wait for your comments or suggestions.


    Jean Henrich from AAII posted over 2 years ago:

    Vaidy Bala: The screens are explained in detail in the Stock Screens area of our web site:

    http://www.aaii.com/stock-screens

    We update performance and lists of companies passing each screen each month. There are also links here to information that can help you get started. We track so many different stock screens because different investors are looking for different types of stocks. Thanks for your interest.
    -Jean, AAII


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