Barry, great post, and your stock screener is very impressive. I have had a look at your website’s description of your screener as well as the results in Stock Rover and a couple of questions arise. I wonder what kind of turnover the screener produces. From month to month, is there a big change? I noticed that your backtests were run with equal weights from the first to the last days of the year. Do you think this strategy is best used with an annual reconstitution/rebalance? I’m a relatively inexperienced investor and just getting familiar with Stock Rover’s screeners but if I understand correctly, the screener compares criteria from the previous 2 calendar years. For example, the equation “Free Cash Flow [Y1] ” > “Free Cash Flow [Y2] ” suggest to me that what’s being compared is 2019’s to 2018’s FCF. So that makes me wonder if it would be worthwhile to start using a portfolio of these stocks now, md-way into 2020.
Hi Matthew, thank you for your kind words. Let me try to answer your questions. The question regarding turnover, it is difficult to assess what the changes would be be thoughout any given year, as the backtesting data uses data for a given calendar year in the past and it is not possible to run a screen from a particular day during previous years. The backtested results will be static because the data is historical and should not change. But I suggest running the screener at the beginning of the year because the current year screener takes advantage of the previous Y1, Y2 yearly data for the stocks. The current screener “Liberated Stock Trader Beat the Market Screener” uses “1-Year Return vs S&P 500 [Now] ” >15 – which means that during the current year you will get different results depending when you run it because the stock needs to beat the S&P by 15%. This will change during the year. Yes rebalanace every year as the data for the previous year changes Your final question regarding is it worth using the screener now, or wait for January. The testable situation would be run it from January. I created the screener in April and have invested in some of the stocks in April. It up to you. thanks again Barry Finally a standard disclaimer. I do want to confirm that no system is guaranteed to make money every year or in fact any year, and LiberatedStockTrader.com accepts no liability or responsibility for anyones investments, I am not a registered financial advisor and do not know your specific risk reward tolerances.
Hi Barry, How about the following as a screener to beat the S&P. Buy the S&P but leveraged by some amount, say 20%. Then you will beat the S&P in years it goes up and lose to it in years it goes down. Your screener (https://www.liberatedstocktrader.com/lst-beat-the-market-screener/) more or less does that.
