Category Archives: Magic Formula Investing

An investigation of the writings of Joel Greenblatt

Magic Hat Portfolio January 2015: KAZ+INDV in, DGO out

I was too disinterested to do a share pick for the Magic Hat portfolio last month, and was about to just leave it for this month/year, but then decided “what the hey”. The portfolio has returned 0% over a 1 … Continue reading

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Magic Hat Portfolio: ITE in

The Magic Hat portfolio on Stockopedia (http://www.stockopedia.com/fantasy-funds/magic-hat-463/) is an experiment by me to see if a human can improve on a mechanical Greeblatt Magic Formula screen. I am trying to weed out “mistakes” that I feel the screening commits: unseasoned … Continue reading

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Magic Hat portfolio: LRM in, SMWH out

The Magic Hat portfolio on Stockopedia (http://www.stockopedia.com/fantasy-funds/magic-hat-463/) is an experiment by me to see if a human can improve on a mechanical Greeblatt Magic Formula screen. I am trying to weed out “mistakes” that I feel the screening commits: unseasoned … Continue reading

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Magic Hat portfolio: CNCT in, BSY out

The Magic Hat portfolio on Stockopedia (http://www.stockopedia.com/fantasy-funds/magic-hat-463/) is an experiment by me to see if a human can improve on a mechanical Greeblatt Magic Formula screen. I am trying to weed out “mistakes” that I feel the screening commits: unseasoned … Continue reading

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Magic Formula selection from a year ago

On 14-Aug-2014 I blogged an example Magic Formula portfolio consisting of 8 shares: http://wp.me/p2eZvw-tc The current share prices are, in pence, for the record: RNK 167, IRV 648, SPT 99, LSC 2450, KENZ, HRG 60, AZN 4202, BA 438 The … Continue reading

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Magic Hat portfolio: NPT in

The Magic Hat portfolio on Stockopedia (http://www.stockopedia.com/fantasy-funds/magic-hat-463/) is an experiment by me to see if a human can improve on a mechanical Greeblatt Magic Formula screen. I am trying to weed out “mistakes” that I feel the screening commits: unseasoned … Continue reading

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Magic Hat portfolio: RB out, WIN in

It’s time to fiddle with my Magic Hat portfolio (http://www.stockopedia.com/fantasy-funds/magic-hat-463/). The exit candidates are BSY, RB, SMWH. I chose to eject RB (Reckitt Benckiser) because it had a PE of 19.2 and an earnings yield of 5.98%. It’s also fairly … Continue reading

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Magic Hat portfolio: IMT out, HNT in

IMT (Imperial Tobacco) get ejected from my fantasy fund over on Stockopedia today. The portfolio is an attempt to see if I can beat the Greenblatt Magic Formula screen. There is some way to go before I fill up the … Continue reading

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Magic Hat portfolio: MJW out, XCH in

It’s time to update the Magic Hat portfolio on Stockopedia. http://www.stockopedia.com/fantasy-funds/magic-hat-463/ Both IMT (Imperial Tobacco) and MJW (Majestic Wine) have the lowest MF (Magic Formula) rankings of 79%. IMT qualifies for the “Screen of Screens”, although it does also appear … Continue reading

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The dangers of tinkering

Interesting extract from the AAII Journal April 2014: Incorrect modifications to the model outnumber correct modifications. Humans can create modifications to a model that can create value. A popular concept in psychology is the “broken leg theory”. Say a human … Continue reading

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