This [cached]short book elaborates on Graham's principle of value investing and puts it into a concrete form, boiling it all the way down to a simple formula you can use for investing: Buy above average companies at below average prizes.
To be more specific, pick a cut off in market capitalization (say 50 million), then rank the remaining stocks based on p/e ratio and return on assets/capital. Buy those that are best when adding both ranks. Gradually phase these portfolio in in groups of a few stocks, then update whenever a stock has been held for one …