One of AAII (American Association of Individual Investors) more popular--and profitable--screens is the 'O'Shaughnessy Tiny Titans'. Since 1998, the screen has produced cumulative results of over 2000%. However, since 2007 the screen has struggled significantly in down markets.
The screen looks for companies with a market cap between $25 million and $250 million, a price to sales of less than 1, excludes over the counter stocks, and finally, ranks the top 25 based on the greatest relative strength over the past 52 weeks. This creates a list of highly volatile and risky stocks.
The screen looks for companies with a market cap between $25 million and $250 million, a price to sales of less than 1, excludes over the counter stocks, and finally, ranks the top 25 based on the greatest relative strength over the past 52 weeks. This creates a list of highly volatile and risky stocks.
However, there may be some names of interest worthy of further research. In addition, one potential strategy would be to pair the portfolio with a hedge by simultaneously shorting the Russell 2000 via RWM with a portion of your portfolio.
Or, an investor could only participate in the strategy when an index such as the Russell 2000 was above a long term moving average. My suggestion for using a moving average system was inspried in part by Mebane Faber's The Ivy Portfolio: How to Invest Like the Top Endowments and Avoid Bear Markets
and also by Tom Lydon, author of The ETF Trend Following Playbook: Profiting from Trends in Bull or Bear Markets with Exchange Traded Funds
.
I ran the AAII Tiny Titans screen using stockscreen123 and came up with the following 25 names. If there is interest among readers, it could be a portfolio I track for free on my blog along with several others already available for free.
and also by Tom Lydon, author of The ETF Trend Following Playbook: Profiting from Trends in Bull or Bear Markets with Exchange Traded Funds.I ran the AAII Tiny Titans screen using stockscreen123 and came up with the following 25 names. If there is interest among readers, it could be a portfolio I track for free on my blog along with several others already available for free.
I also looked at the 1, 3, 5, and 8 year performance when the portfolio was rebalanced every 4 weeks. Over the past 1 year, the screen returned 105.4% excluding slippage and commissions. Over the past 3 years, the screen returns were approximately -21.4% excluding slippage and commissions. Over the past 5 years, the cumulative return was approximately 64.9% excluding slippage and commission. The 8 year performance, however, was an outstanding 550% excluding slippage/commissions. If we add in a 1% assumption for slippage, the 8 year performance is 327.4%.
Whether or not this strategy can sustain its long-term swagger remains to be seen. A significant market pull-back could result in significant losses in the screen.
Whether or not this strategy can sustain its long-term swagger remains to be seen. A significant market pull-back could result in significant losses in the screen.
Below is the current list ranked on their 52 week return as of 4/16/10. The list will differ from the AAII list because that list was updated 1/31/10. This is not a screen I would blindly invest in without significant further investigation of each name, an acute awareness of the liquidity of each stock, and also without using stop losses and/or a hedge.
If an investor wanted to run this screen--or variations of it-- for free he or she could do so using any number of free stock screens such as the one available at Finviz. or the aforementioned stockscreen123.
| Ticker | Name | Last | Free Trend Analysis | MktCap | Industry | Sector |
| LBY | Libbey Inc. | 13.8 | Here | 222.98 | Appliance & Tool | Consumer Cyclical |
| SPCHA | Sport Chalet, Inc. | 3.33 | Here | 46.96 | Retail (Specialty) | Services |
| BELM | Bell Microproducts Inc. | 6.98 | Here | 225.76 | Computer Peripherals | Technology |
| LEE | Lee Enterprises, Incorporated | 4.35 | Here | 195.2 | Printing & Publishing | Services |
| CVGI | Commercial Vehicle Group, Inc | 8.77 | Here | 207.56 | Auto & Truck Parts | Consumer Cyclical |
| BIOF | BioFuel Energy Corp. | 2.94 | Here | 95.76 | Chemical Manufacturing | Basic Materials |
| SALM | Salem Communications Corp | 5.24 | Here | 124.54 | Broadcasting & Cable TV | Services |
| PATK | Patrick Industries, Inc. | 3.15 | Here | 28.92 | Constr. - Supplies & Fixtures | Capital Goods |
| SYPR | Sypris Solutions, Inc. | 4.22 | Here | 83.11 | Auto & Truck Parts | Consumer Cyclical |
| MERC | Mercer International Inc. | 5.73 | Here | 208.87 | Paper & Paper Products | Basic Materials |
| SMTX | SMTC Corporation (USA) | 3.05 | Here | 42.53 | Semiconductors | Technology |
| CMRG | Casual Male Retail Group, Inc | 3.8 | Here | 179.25 | Retail (Apparel) | Services |
| NXST | Nexstar Broadcasting Group, I | 6.47 | Here | 183.94 | Broadcasting & Cable TV | Services |
| RURL | Rural/Metro Corporation | 6.76 | Here | 170.67 | Misc. Transportation | Transportation |
| GTN | Gray Television, Inc. | 3.25 | Here | 158.06 | Broadcasting & Cable TV | Services |
| NAVI | NaviSite, Inc. | 2.78 | Here | 101.31 | Computer Services | Technology |
| KID | Kid Brands Inc | 9.37 | Here | 202.18 | Recreational Products | Consumer Cyclical |
| LCUT | Lifetime Brands, Inc. | 13.98 | Here | 167.97 | Personal & Household Prods. | Consumer/Non-Cyclical |
| ESCA | Escalade, Inc. | 4.16 | Here | 52.76 | Recreational Products | Consumer Cyclical |
| SBSA | Spanish Broadcasting System I | 1.02 | Here | 66.3 | Broadcasting & Cable TV | Services |
| PUDA | Puda Coal, Inc | 9.9 | Here | 192.46 | Coal | Energy |
| NNBR | NN, Inc. | 6.93 | Here | 114.46 | Misc. Fabricated Products | Basic Materials |
| NAVR | Navarre Corporation | 2.19 | Here | 79.64 | Software & Programming | Technology |
| AGM | Federal Agricultural Mortgage | 15.63 | Here | 158.55 | Consumer Financial Services | Financial |
| WSTL | Westell Technologies Inc. | 1.48 | Here | 99.78 | Communications Equipment | Technology |
Disclosure: No Positions
Source: Tiny Titan Portfolio for April
