Fisher (Philip) Screen
|Fisher (Philip)||S&P 500|
|Five Year Return:||-3.1%||13.8%|
|Ten Year Return:||0%||5.5%|
Investment approaches are often categorized as being either growth or value oriented. William O'Neil's CAN SLIM system focuses exclusively on smaller, market-leading companies, with accelerating earnings growth and price momentum. O'Neil shows little concern over buying a stock with a rich price-earnings multiple, and feels that market timing is an important element to a successful approach to investing.
On the other hand, the Benjamin Graham approaches focus on trying to buy a dollar's worth of stock for 50 cents. Graham's stock selection technique places an emphasis on locating financially sound stocks with reasonable prices compared to asset values and earnings levels. While earnings and dividend growth were an important consideration for Graham, earnings stability was emphasized over eye-popping earnings growth.
Fisher received his professional start in the financial markets in 1928 as a "statistician" for a bank underwriting securities. The norm at that time was highly margined investments in speculative issues without investor research or knowledge of the business. Even Fisher lost a significant amount of money in the 1929 crash by investing in a few stocks that still looked cheap because of their low price-earnings ratios, though his analysis of the market identified it to be highly risky and ready for the "greatest bear market in a quarter of a century."
…To read more, please become an AAII member or login.