An honest demo, no cheating (point-in-time): each year we pick the 20 stocks using only the info known before the buy date, buy, and sell 12 months later. Here are the actual stocks selected and their real return, method by method. → Understand the method
*risk/return ratio (Sharpe) — higher is more efficient per unit of risk. The S&P 500 ≈ 0.86. A single period (11 years, 2015-2025), excluding fees/taxes, universe = companies still in the index (survivorship bias). A quality signal, not a guarantee. The current year (⏳) is not counted in the total (unfinished cohort).
💡 Many of these picks had already fallen over 12 months at buy time — normal, the method targets potential (beaten-down stocks = big gap to target). Over 2021-2025, ~half the picks were fallen stocks, and they rebounded +38%/yr on average the next year (vs +33% for those already rising) — each return is over 12 months, not a multi-year hold. ⚠️ But this rebound is very uneven by year: it ranged from −18% in 2024 (the fallen stocks kept dropping) to +95% in 2023 (a huge rebound). A beaten-down stock can keep falling for another year before recovering.
💡 A loss is capped at −100%. A gain is not.
That's the whole logic of the method: we let winners run. A stock cut too early at +150% could have done +743% (TSLA 2020). We tested it over 11 years: taking profits at +150% costs −5 pts/yr, and a tight stop-loss costs too (stocks often rebound). Returns are made on the few winners you hold, not the losers you cut.