Strategy
Joel Greenblatt Magic-Formula proxy
Buy good companies (high ROIC) at cheap prices (high earnings yield). Hold a basket; rebalance annually.
“Pick good companies and buy them at bargain prices. The market will eventually agree with you.”
These strategies are RULE-BASED PROXIES named after well-known investors as a recognizable shorthand for each philosophy. They are NOT those investors' actual portfolios, holdings, or recommendations. The names are used purely as labels for the underlying screening criteria, which are listed in full on every page. ActaClear has no affiliation with any of the named investors. Past performance does not guarantee future results. This is not investment advice — always do your own due diligence.
The exact criteria
- ✓5-year average ROE ≥ 20% (quality proxy)
- ✓5-year average net margin ≥ 10%
- ✓Latest revenue ≥ $1B
- ✓Positive latest net income
- ✓We use ROE as a free proxy for ROIC (true ROIC needs invested-capital data we don't yet have for every name)
Sorted by roe (window: 5y, calc: avg, direction: desc). Refreshed hourly from the SEC fundamentals in our database.
Companies passing today (25 shown, 115 total)
Primary screen returned 200 candidates; 115 pass the additional criteria.
| Rank | Company | Latest revenue | 5y avg ROE | 5y avg net margin | D/E |
|---|---|---|---|---|---|
| 1 | AAPL Apple Inc. | $416.16B | 171.0% | 25.5% | 1.06 |
| 2 | AMGN AMGEN INC | $36.75B | 106.7% | 20.9% | 5.78 |
| 3 | NTAP NetApp, Inc. | $6.57B | 147.4% | 16.3% | 2.17 |
| 4 | ADP AUTOMATIC DATA PROCESSING INC | $20.56B | 76.6% | 18.7% | 0.64 |
| 5 | LLY ELI LILLY & Co | $65.18B | 77.7% | 22.4% | 2.86 |
| 6 | APP AppLovin Corp | $5.48B | 60.4% | 19.9% | 1.65 |
| 7 | IDXX IDEXX LABORATORIES INC /DE | $4.30B | 79.6% | 22.8% | 0.23 |
| 8 | SHW SHERWIN WILLIAMS CO | $23.57B | 67.9% | 10.3% | 2.03 |
| 9 | ALSN Allison Transmission Holdings Inc | $3.01B | 63.2% | 20.6% | 1.75 |
| 10 | LRCX LAM RESEARCH CORP | $18.44B | 64.6% | 26.8% | 0.38 |
| 11 | ULTA Ulta Beauty, Inc. | $12.39B | 61.1% | 11.0% | — |
| 12 | AMP AMERIPRISE FINANCIAL INC | $18.91B | 60.1% | 20.2% | 1.67 |
| 13 | NVDA NVIDIA CORP | $215.94B | 58.1% | 42.5% | 0.05 |
| 14 | ZTS Zoetis Inc. | $9.47B | 54.4% | 27.0% | 2.71 |
| 15 | WSM WILLIAMS SONOMA INC | $7.81B | 56.7% | 13.5% | — |
| 16 | MCO MOODYS CORP /DE/ | $7.72B | 60.5% | 29.8% | 1.73 |
| 17 | ADSK Autodesk, Inc. | $7.21B | 51.7% | 15.6% | 0.82 |
| 18 | DECK DECKERS OUTDOOR CORP | $5.47B | 46.4% | 21.7% | — |
| 19 | UNP UNION PACIFIC CORP | $24.51B | 46.2% | 28.3% | 1.64 |
| 20 | BYD BOYD GAMING CORP | $4.09B | 42.6% | 21.6% | 0.78 |
| 21 | ABNB Airbnb, Inc. | $12.24B | 34.0% | 21.9% | 0.00 |
| 22 | DDT DILLARD'S, INC. | $6.56B | 45.3% | 10.8% | 0.13 |
| 23 | DDS DILLARD'S, INC. | $6.56B | 44.9% | 10.8% | 0.13 |
| 24 | CMG CHIPOTLE MEXICAN GRILL INC | $11.93B | 40.5% | 11.6% | — |
| 25 | NOG NORTHERN OIL & GAS, INC. | $6.26B | 35.2% | 12.8% | 1.13 |
How would this strategy have performed?
Equal-weight top 25 from this strategy, rebalanced every six months back to equal weight, vs SPY. Read the caveats below.
- Survivorship bias: we only see companies that exist in our database today. Anything that was acquired, went bankrupt, or got delisted is invisible. This systematically OVERSTATES historical returns for any rule-based screen — losers are removed.
- Look-ahead bias (v1): picks are chosen with today's fundamentals, not the fundamentals that were public at the start of the lookback. A true point-in-time backtest is on the roadmap.
- Price freshness: end prices are the most-recent value in our database, which may lag the live market by weeks for less-popular tickers.
- Equal-weight, no rebalancing, no transaction costs, no taxes, no dividends reinvested. This is a free rule-based simulation, NOT a track record and NOT investment advice.
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