John Dorfman’s Robot Portfolio--again

[Ed_The_Gypsy]

In January, John Dorfman stopped writing a regular column for Bloomberg to skin the rubes run his investment firm. He wrote a final column, “Nine lessons a columnist learned”.

Here are his nine lessons:
1. Out-of-favor stocks are the best road to capital gains.
2. Don’t be swayed by what Wall Street analysts say.
3. High portfolio turnover is not necessary for good results.
4. The investment value of a stock is independent of whether it has been moving up or down.
5. Predicting the market with consistency is extremely difficult.
6. Predicting the economy is probably even harder.
7. High valuations alone aren’t a good reason to sell a stock short.
8. High profits alone are no reason to invest in a stock.
9. Dialog with readers was one of the best parts of [his] experience as a columnist.

Dorfman created the Robot Portfolio mentioned here earlier. His Lesson #1 talks about it.

A fellow named Harry Domash has a web site named Winning Investing.com and has a section on the Robot Portfolio, http://www.winninginvesting.com/robot_stocks.htm, which includes a section on Create Your Own Robot Portfolio using Quicken’s Stock Screener at their website.

Domash says, pick the Full Search option.
1) Enter $500 million minimum acceptable Market Cap in the Valuation section.
2) Use the Net Profit Margin (NOM); specify a minimum 1% NPM to eliminate unprofitable companies.
3) Enter a maximum long-term debt-to-equity ration of 1 in Financial Strength.
Click on Show Results. Domash got a list of about 1,300 stocks when he ran it. The Robot stocks are the 10 cheapest stocks—the 10 with the lowest P/E ratios. He tells how to arrange the list with the 10 lowest P/Es at the top. He then applies common sense to eliminate unduly risky stocks. (Say what? )

Just for fun, I looked into this and ran into something of a roadblock as Quicken’s web site has changed since. One thing is that to use anything there one must be registered. I don’t know if their stock screener is even there anymore, and having read here about problems and headaches with Quicken, I am not inclined to buy Quicken just to find out.

OK, does anyone know if Quicken’s web site still has this feature?

If so, how much does it cost to become registered? (Buy Quicken, or what?)

In any case, is there anywhere else where one could do the same screening?

(No, I have not fallen off the wagon. Still 'Staying the course'...but UncleMick understands. : )

Cheers,

Gypsy

 

[terminator]

Domash says, pick the Full Search option.
1) Enter $500 million minimum acceptable Market Cap in the Valuation section.
2) Use the Net Profit Margin (NOM); specify a minimum 1% NPM to eliminate unprofitable companies.
3) Enter a maximum long-term debt-to-equity ration of 1 in Financial Strength.
Click on Show Results. Domash got a list of about 1,300 stocks when he ran it. The Robot stocks are the 10 cheapest stocks—the 10 with the lowest P/E ratios. He tells how to arrange the list with the 10 lowest P/Es at the top. He then applies common sense to eliminate unduly risky stocks. (Say what? Shocked )

Even using a liberal helping of common sense, I can almost guarantee you that if you did that you would own nothing but bank, oil and/or insurance stocks.

Anyway, more to your point Yahoo Finance has a screening tool that will almost certainly accomplish what you want to do.

 

[LOL!]

A great free stock screener is the deluxe one at http://moneycentral.msn.com/investor/home.asp
In the left-hand panel, click on "Stock Screener". Be sure to install and use the deluxe version. With deluxe, you get a PortfolioManager (almost just like the one in MSMoney), great charting, an excellent fund screener, and the stock screener.

If you check this out, please report back here and let us know what you think.

 

[Ed_The_Gypsy]

Thanks, gents.