Graham in the early 1930s. In a 1992 paper, Tweedy, Browne outlined the five characteristics they use to select stocks. (1) Low price to book value; (2) low price to earnings ratio; (3) significant stock purchases by executive officers at a company, particularly when stock price drops, indicating insiders have confidence in long-term company prospects; (4) significant drop in stock price; (5) small market capitalization. While these traits do not guarantee a positive outcome, the firm cites academic research from around the world to indicate these traits may increase the odds of investing success when consistently applied over time. References External links Tweedy, Browne website Investment management companies of the United States Companies based in Stamford, Connecticut