Marc Reinganum

Marc Reinganum

Marc Reinganum holds a Ph.D. from the University of Chicago and currently teaches finance at the College of Business Administration, University of Iowa. He is also a senior investment manager with State Street Global Advisors, the world’s second largest asset manager. He has appeared on the cover of Money Magazine and featured in the Wall Street Journal, Fortune, Forbes and Bloomberg, and is regularly interviewed on CNBC.

Summary

Reinganum is best known for his article entitled ‘The Anatomy of a Stock Market Winner’ in which he established a set of characteristics exhibited by stocks that increased their value by at least 100% in one calendar year. While factors can be put into general categories of value like modest valuation, growth accelerating earnings and high Momentum, Reinganum’s interesting finding was that these factors combine in several ways to help stocks become winners. He thus concluded that these factors need to be combined to achieve success.

Success Formula Stock Market Winners

  1. MktCapM is >= US$ 300 million (basis year 2000) adjusted yearly
  2. Current P/B ratio is < screening universe average * 0.6
  3. EPS growth % for the last FQ is > 0
  4. EPS growth % for last 5 FY is > 0
  5. Latest filing Pre-tax profit margin % is > 0
  6. 3m Relative Price Strength is > 6m Relative Price Strength
  7. Price 1 day ago is within 25% of the 2y high Price
  8. # Outstanding Shares is < screening universe average * 0.5
  9. Take the top 100 stocks with the highest 52 week Relative Price Strength

Hypothetical performance back-tested

Data source: Bloomberg, Calculations: meetinvest

Disclaimer

Hypothetical performance is not necessarily indicative of future results. No representation is being made that any action will achieve profits or losses similar to those displayed. The result may be overstated as neither transaction costs nor bid/ask spreads nor slippage have been considered. Output equally weighted with maximum 5% allocation per position and rebalanced monthly. Holdings are systematically replaced when the screening criteria are not met anymore. No additional buying or selling rules (technical analysis) have been employed.

Historical monthly relative performance

How to read this graph:
A green bar shows how much the guru strategy outperformed the benchmark index in a particular month. A red bar shows how much the guru strategy underperformed the benchmark index in a particular month.

Data source: Bloomberg, Calculations: meetinvest

Disclaimer

Hypothetical performance is not necessarily indicative of future results. No representation is being made that any action will achieve profits or losses similar to those displayed. The result may be overstated as neither transaction costs nor bid/ask spreads nor slippage have been considered. Output equally weighted with maximum 5% allocation per position and rebalanced monthly. Holdings are systematically replaced when the screening criteria are not met anymore. No additional buying or selling rules (technical analysis) have been employed.

Historical portfolio turnover

Data source: Bloomberg, Calculations: meetinvest

Books

Free Stock Screening Tool