Fundamental
Fundamental is a moderately low-beta, moderately low-turnover trading plan for stocks traded on major U.S. exchanges. It focuses on providing above-market returns over the longer term while keeping a variability of returns that is similar to the market’s risk profile.
Information is as of the close on November 9, 2007.
Model Allocation
These are the twenty qualifiers with highest ROE, shown in ticker alpha sort. This system would buy an equal-weighted share (approx. 5%) in each security, and hold for four weeks before re-evaluating.
Affiliated Mgrs Grp (AMG)
Abercrombie & Fitch (ANF)
Amphenol Cp (APH)
Cpfl Energia Sa Ads (CPL)
Diamond Offshore Drl (DO)
Garmin Ltd. (GRMN)
Gymboree Corporation (GYMB)
Infosys Technologies Limited (INFY)
Jones Lang LaSalle (JLL)
Kinetic Concepts Inc (KCI)
Mobile Telsys Ojsc (MBT)
Mcdermott Int Panama (MDR)
Microsoft Corporation (MSFT)
Mechel Oao Ads (MTL)
Nvidia Corporation (NVDA)
Partner Communications Co. Ltd. (PTNR)
TransOcean Inc (RIG)
Sap Aktiengesell Ads (SAP)
SEI Investments Company (SEIC)
Schlumberger Ltd (SLB)
Tracking
Consider this site’s initial post on the model to be a “buy” on Monday’s open, at market, for the above allocations.

November 11th, 2007 at 11:01 pm
Bill,
So the position is 100% long, correct? I like the use of ROE, it feels comfortable with my favoring dividends related picks. I will be watching how this turns out. Congrats and good luck with the new site. Dallas
November 12th, 2007 at 4:43 am
Hey Bill, very nice redesign!
Its clean, loads fast, soft colors are easy on the eyes.
Very professional looking — better than the doodahs . . .
November 12th, 2007 at 4:48 am
Yes, this system is 100% long 100% of the time. Any trader’s or system’s return is composed of the market return, plus contributions from technical factors in security selection or entry/exit, contributions from fundamental factors in security selection, and blind luck. Holding 20 at a time will hopefully minimize the role of luck, and this system doesn’t use technical analysis, hence the name “Fundamental.”
The earnings quality metrics may tend to stilt this system towards dividend-payers over the long haul.