Creating and Testing a Value Strategy With Portfolio123

June 16, 2018

Marc Gerstein is director of research at Portfolio123, a stock screening and research website.

It’s 1980-something and I’m standing in the office of then-Value Line research director Lou Kirschbaum with a few other senior members of the research staff. Lou, a self-described fan of the emerging PC era, is demonstrating a new piece of software that can be used to zip through a database and find the exact kinds of stocks one wants to find. We watch in amazement as the lights flash back and forth to show the computer going between the A drive (in which the floppy disk containing the program was inserted) and the B drive (containing a floppy disk that held the entire Value Line equity database) and then voila! barely a minute later, the monitor flashes names and tickers of a dozen or so stocks with price-earnings (P/E) ratios under 15x (or something similar) and company growth rates above a target that we told Lou to input. I was hooked, my career turned on a dime and I never looked back.

Before getting into Portfolio123, I want to reinforce how important this topic really is. Screening and all that surrounds it is not a trade-show gimmick, a tool, a gizmo, a feature or anything like that. It’s the solution to the investor’s main pain points: What to buy, when to buy and, yes, even the age-old conundrum of when to sell.

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