That paper demonstrates a purely mechanical annual rebalancing of stocks meeting Graham's
net current asset value criterion generated a mean return between 1970 and 1983 of «29.4 % per year versus 11.5 % per year for the NYSE - AMEX Index.»
Not exact matches
His
net -
net selection
criterion was buying stocks trading as low as 2/3 of their
net current asset value (NCAV).
The fifth
criterion Graham and Rea used called for the stock price to be below the company's per share
net current asset value NCAV or «
net quick»
asset value.
Further research by Tweedy, Browne has indicated that companies satisfying the
net current asset criterion have not only enjoyed superior common stock performance over time but also often have been priced at significant discounts to «real world» estimates of the specific
value that stockholders would probably receive in an actual sale or liquidation of the entire corporation.
This involves ranking all businesses over just 1
criteria (
net current asset value) and buying the cheapest.