Top 25 Picks by MFI
2Mar2007 Filed under: Stock screens Author: OptionPunditAttached is the latest screen from magic formula investing (for greater than $500 million market cap). I ran this screen to find out if there are great bargains available after the recent sell-off. 
I have extensively discussed this strategy in several posts. Pls find out from “Magic formula investing” under OP reading category. There are several interesting names that one could look for to create a positive delta bullish spread strategy to use at the first sign of market turning direction to bull. Profitable trading, OptionPundit
bullish spread, income trade, Magic formula investing, option trading, stock option trading, Stock screens2 Responses to “Top 25 Picks by MFI”
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This assumes a $10,000 starting and fully invested capital. The current phase started when OPNewsletter was re-opened in Jan'08 for Feb'08 expiration. OPN Month is counted as 3rd Friday of each month same as US Equity option expiration day. Comparison with S&P500 or Dow is not shown as it's unfair to expect from such large institution to deliver high returns. I would rather compare with my own target.
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Hendrik Oude Nijhuis
March 4th, 2007 at 4:53 pm
Hello,
Selecting stocks with high ROIC’s in combination with a high EY’s makes sense. But, there can be a lot of factors which can lead to a high ROIC, for shorter or longer time frames, with or without the existence durable competitive advantages.
So, in a selection of high ROIC stocks, one would find stocks WITH and WITHOUT (durable) competitive advantages. As Greenblatt says he uses the high (present) ROIC as an indication of a relative high further ROIC, one should opt for high present ROIC in combination with durable competitive advantages (DCA), as stocks with DCA’s have high ROIC’s for longer time frames.
In short, I would recommend to do some research on competitive advantages / business models, and then to combine this knowledge with the selections of Greenblatt,
Success in investing!,
Hendrik Oude Nijhuis
stas
March 5th, 2007 at 5:14 pm
According to this ACH is the best stock. However it is to prone to general market trend, which is clearly down today.