In this article I cover the Wanger stock-picking strategy and give you a list of stocks currently passing our screen based on the approach. Ralph Wanger’s investing style of holding small companies with financial strength, entrepreneurial managers and understandable businesses allowed him to generate enviable returns while managing the Acorn Fund between 1970 and 2003.
The Wanger strategy focuses on limiting the risk of investing in small-cap stocks, using value, size and growth to find small-cap companies that exhibit long-term growth characteristics. As of April 28, 2023, AAII’s Wanger screening model has an annual gain since inception (1997) of 7.7%, versus 7.0% for the S&P SmallCap 600 index over the same period. The Wanger screen is up 3.0% year to date, compared to a decrease of 0.7% for the S&P SmallCap 600 over the same period.
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