Adapting a Graham Disciple's Approach: AAII's Walter J. Schloss Screen
Individual investors can adapt Walter Schloss’ investing approach for their own use. AAII’s Walter J. Schloss screen was developed using AAII’s Stock Investor Pro fundamental stock screening and research database program. Stock Investor Pro covers a universe of over 9,500 NYSE, Amex, and NASDAQ stocks.
First, we excluded over-the-counter stocks as well as American depositary receipts (ADRs). Since Schloss preferred exchange-listed U.S. companies, we excluded all ADRs.
Schloss did not explicitly exclude any sector in his portfolio. However, because he uses the price-to-book-value ratio to evaluate companies, we excluded stocks in the financial sector because their balance sheets are not comparable to those in other industries. Book value tells you the accounting value of a firm after it pays all of its debt.
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