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Adjusting the Benjamin Graham Enterprising Investor Screen

by John Bajkowski

Adjusting The Benjamin Graham Enterprising Investor Screen Splash image

Since 1934, the works of Benjamin Graham have helped to guide individual and professional investors in their quest to make good investment decisions.

Graham’s intrinsic value approach grew out of the lessons learned from the stock market crash of 1929. Rather than trying to beat the market by seeking the best companies in the hottest industries, Graham argued that it is safer to build a portfolio of undervalued stocks that are being ignored or discriminated against by the market. Graham’s approach focused on the concept of an intrinsic value that is justified by a firm’s assets, earnings, dividends and financial strength.

Graham’s philosophy continues to flourish through two primary books: “Security Analysis,” co-authored with David Dodd, and “The Intelligent Investor.” “Security Analysis” was first released as a college investment textbook back in 1934 and was most recently revised in 2008 (sixth edition, McGraw-Hill). “Security Analysis” presents the investment process by covering the analysis of the economy, sectors and industries, financial statements, and bonds and stocks. “Security Analysis” is still used as a textbook at Columbia Business School.

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John Bajkowski is president of AAII.


Discussion

Helen Kirkpatrick from Maryland posted about 1 year ago:

GOOD!!!


Oscar Botero from Florida posted about 1 year ago:

Why dont you hold these 4 stocks in the model
shadow stock portfolio?


Robert Sturgis from Texas posted about 1 year ago:

OK, nice update, next lets consider what Ben would have learned from the current "Great Recession" and apply this to your next rev. of the master's work.


Ferdinand Wieland from Delaware posted about 1 year ago:

How can the Benjamin Graham Enterprise Investor Screen (buy low valuation stocks and bonds) by applied to ETF and Mutual Funds?


John Bajkowski from Illinois posted about 1 year ago:

The two microcap stocks (DIT & FRD) that passed the Graham Enterprising screen have current price-to-book-value ratios just above the current cut off (p/book of 0.8) for a new stock to be added to the Shadow Stock Portfolio. They are in the hold range for the Shadow Stock portfolio with a p/book between 0.8 and 2.4.


Craig Wallin from Washington posted about 1 year ago:

Will these revised criteria be used in the monthly updates of the Graham Enterprising Investor stock screen?
I noticed the stock screens section of the web site still shows the "old" criteria and passing company.


MT Bowling from Texas posted about 1 year ago:

Thanks for spending time working on the Graham Enterprising screen. I have a couple of modified versions that I use because of the potential returns. I pay more attention to the Graham screens than any of the others due to the long term performance and simple, clear criteria.


John Schott from Florida posted about 1 year ago:

Thanks for your efforts to improve upon and already proven,valuable tool
I praise AAII for its steadfast efforts to provide the small independent investor sound advice.


Gary Stadtmauer from New York posted about 1 year ago:

What concerns me about some of the stock screens, including this one, is that the bid/ask spread is so wide for some stocks. That is not taken into account in the screen performance so the returns are not realistic. Even if you trade in an IRA w/very low cost trading you cannot overcome that problem. Why report these results if they are not reproducible in the real world?


David Thompson from California posted about 1 year ago:

I get all of the S&A newsletters (updates and issues, and special reports), and I don't see much in the AAII information that can provide more than what I am already getting. I am a lifetime AAII member.


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