Stock Picking

In the investment world, small-cap growth stocks have long attracted the attention of professional investors and fund managers due to their high growth potential and price flexibility. At the core of Gardiner’s strategy is the identification of companies with relatively small market capitalizations, strong earnings growth, and solid fundamentals. He focuses on potential stocks with a price-to-earnings growth (PEG) ratio below 1. To test the applicability of this strategy in the Taiwanese stock market, this study adopts Gardiner’s screening principles to develop a set of quantifiable selection criteria, conducts backtesting on Taiwan equities, and further explores the empirical performance of small-cap growth investing in the local market.

Peter Lynch is a legendary figure in the American mutual fund industry. He is widely regarded as one of the most successful fund managers in history. Beyond his remarkable performance, Lynch is also known for his accessible investment philosophy, which has inspired countless individual and professional investors. Lynch advocates the principle of “invest in what you know,” believing that individual investors have the advantage of observing the world around them and can often identify promising companies before their fundamentals are reflected in stock prices. Using indicators such as the price-to-earnings (P/E) ratio and earnings per share (EPS) growth, Lynch aimed to uncover “undervalued growth stocks.”

Highlights Preface Survivorship bias refers to a type of error in research or observation where only the successful or surviving entities or events are considered, while the failures or disappearances are ignored or excluded. This bias can lead to a misunderstanding of the overall situation because observing only the successful or surviving entities may not […]