Ziggma Stock Scores

ZIGGMA STOCK SCORES

  • Automated and unbiased fundamental analysis on 2,500+ stocks, powered by cutting-edge data processing technology.
  • The large number of data points (tens of millions) allows for an absolute ranking for all stocks within an industry on a scale of 0 to 100.
  • Excellent performance results: Avg. annualized return of 18% vs. 10.3% for the S&P 500 (2011 – Nov 2020)*
  • This level of  data analytics was previously reserved to high-powered hedge funds. Significantly reduced data and processing cost enable us to make it more broadly available.

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* The chart illustrates the performance of a portfolio comprising the top-rated 10% of stocks in each industry over the time period 2011 through 6 Nov 2020. While the exact replication of the tested investment strategy may only be available to investors capable of managing large portfolios, the track record clearly demonstrates that stocks with Ziggma Scores in the top 10% of an industry generated a substantial outperformance. By deduction, top ranking stocks by Ziggma Score as a whole are likely to produce higher long-term returns than stocks outside the top 10%. Please keep in mind that past performance is no guarantee of future results.
In light of each industry’s many idiosyncrasies, we strongly advise against comparing stocks, scores or companies across industries.

ADVANTAGES OF USING THE ZIGGMA STOCK SCORES:
WE CRUNCH THE NUMBERS FOR YOU

  • Move the odds in your favor: Picking the best ranked stocks in each industry has proven to generate substantial outperformance*.
  • Save time: Our Ziggma Stock Scores will help you pick the winners in each industry quickly while staying away from the losers. All you have to do is use the Scores as a screen setting in our free stock screener.
  • Remove the risk of judgement errors: Our automated, quantitative approach provides 100% unbiased results.
  • Monitoring: By keeping an eye on your holdings’ Ziggma Scores, you will be able to track the attractiveness of your stocks over time.
  • Developed by seasoned financial analysts: Our team has decades of experience working for leading global asset managers.

ZIGGMA SCORES EXAMPLES

Our Approach

  • Combine the principles of fundamental analysis with algorithm-enabled, cutting-edge data processing technology…
  • …to generate a relative ranking of stocks for each industry.
  • Capture a total of 32 KPIs over a multi-year observation span across the evaluation categories growth, profitability, valuation and financial position.
  • Apply various layers of weights to reflect the importance of a category, KPI or data point in time.
  • Score stocks on a scale of 0 – 100 to provide an unambiguous ranking of worst to best.

Why use Ziggma’s Stock Scores

  • Numeric stock scores: Get a clear idea of how stocks rank relative to each other within a given industry. This helps you research stocks much more efficiently than by looking at indiscriminate Buy, Hold or Sell ratings.
  • Affordable access to quantitative research that was previously available only to large hedge funds
  • Big data approach: 32 custom and industry-specific KPIs, multi-year period, custom-weights for each metric, industry-specific metrics, millions of data points.
  • Use the scores to monitor your stocks’ attractiveness over time.
  • Daily updates of all stock scores to immediately reflect new information.
  • Developed by a team of seasoned financial analysts and talented developers.

Frequently Asked Questions

Why is backtesting important and how we implement it?
Backtesting is the method for testing how well a strategy or a model would have done using historical data. To implement backtest, we create a hypothetical portfolio of the top 10% scored stocks in each industry using historical scores and stock returns from 01-01-2011 to 11-06-2020. The hypothetical portfolio is re-balanced once a month. In order to capture the income return, the returns are exclusive of paid dividends and are solely based on daily adjusted closing prices. The backtest results show that the strategy of Ziggma portfolio outperforms the relevant benchmark over the examined period.
We cover stocks trading in the US. In order to get the most robust data set, we apply a marketcap filter so that we select onlw companies whose market capitalization was greater or equal to $100 million at least once during the last 3 months. The reason for this is that below this threshold there are too many “special” cases, such as zombie companies, startups, special acquisition vehicles, etc. with aberrant ratios, income statements or balance sheets.
In mathematics, the pigeonhole principle refers to the situation when n pigeons are put into m containers, with n>m, then at least one container must contain more than one pigeon. Similarly, some industries incorporate more than 100 peers, so unavoidably some stocks in particular industries will have the same score/ranking (0 – 100). Although the raw score is usually a unique decimal number for each stock, using the empirical cumulative distributionn we end up having two or three companies having the same score within large industries.
When more than one class of stock is offered by a company, they are usually designated as Class A shares and Class B shares. We have decided to score them both. Normally, the two have similar scores.

*Past performance is no guarantee of future results. Ziggma does not act as an investment, legal, accounting or tax advisor and is not a licensed securities dealer, broker or US investment adviser or investment bank. Ziggma scores do not act as a buy, sell or a hold security recommendation. The backtested results do not reflect or guarantee any future performance and they do not imply that any specific investment strategy will be profitable or identical to past performance levels.