// STUDY RESULT · 1995-08 TO 2026-07
Neff's Low-P/E + Yield Discipline
NO EDGEBuy solid growers at low P/Es with dividends; the 'total return / P/E' ratio finds them.
| THE STRATEGY | $SPX BUY & HOLD | |
|---|---|---|
| Growth a year (CAGR) | 4.1% | 8.8% |
| Return per unit of risk (Sharpe) | 0.36 | 0.63 |
| Worst fall (max drawdown) | -51.0% | -52.6% |
// GROWTH OF $1, LOG SCALE
AMBER: THE STRATEGY · GREY: $SPX BUY & HOLD
Tested on years it never saw (from the split): 8.3% a year against 12.4% for the benchmark; Sharpe 0.22 in the training years, 0.52 after.
After 25 bps of trading costs: 3.1% a year. WITHIN RANDOM
// DECADE BY DECADE
| ERA | STRATEGY | BENCHMARK |
|---|---|---|
| 1990s | 0.0% | 22.9% |
| 2000s | -2.4% | -2.6% |
| 2010s | 9.0% | 11.6% |
| 2020s | 10.0% | 14.1% |
// THE IDEA, AS PUBLISHED
John Neff, 'John Neff on Investing' (1999) · 1999
- Low P/E, well below the market's; (EPS growth + dividend yield) / P/E well above the market's
- Earnings growth above 7%, wary of rates above about 20%
- Solid companies; sell when fundamentals fade or price reaches value
A real computation on the QuantGPT warehouse, survivorship-free, walk-forward. Gross returns, no costs except where stated. Past performance is not a promise. Findings, not advice. COMPUTED 2026-09-24 19:42 ON THE QUANTGPT WAREHOUSE: EVERY DELISTED NAME KEPT, FUNDAMENTALS AS FILED. NOT INVESTMENT ADVICE.