Quantifying The Motley Fool’s Small Cap Growth Investment Strategy

Excess Returns · Mar 28, 2021 · 17m

The Motley Fool is not known for their quantitative models. They are known for a discretionary growth style of investing that attempts to identify game changing companies and then holds them for the long-term, seeking to generate returns that are multiples of their original investment.

But despite their discretionary nature, their book The Motley Fool Investment Guide did contain a detailed quantitative model to select small-cap growth stocks. When we launched Validea in 2003, we wouldn't have guessed that this model would have outperformed all the other models we launched, but it has…