Excess Returns, Episode 6: The Case Against Value Stocks

Confirmation bias is one of the biggest problems in investing. We all have a set of core beliefs, and we tend to surround ourselves with people who also believe them and focus on information that validates them. That can be dangerous, though, because it can blind you to valid arguments that contradict your own. In this episode, we challenge our belief in value investing and discuss some of the reasons why we could be wrong.… Read More

Excess Returns, Episode 5: The Double Edged Sword of Avoiding Value Traps

Many value stocks are cheap because they deserve to be. Some of them no longer have sustainable businesses, and as a result their current discounted multiple will look really expensive relative to where their business is headed. These types of stocks are often referred to as “value traps” and value investors do everything they can to avoid them. In this episode, we talk about value traps, why they are impossible to avoid completely, and some… Read More

Excess Returns, Episode 4: Lessons From March For The Fallen

Whether you are training for and participating in a 25+ mile march or are saving and investing for retirement and long-term wealth creation, success requires the right mindset as well as discipline and patience. In this episode of Excess Returns, Justin Carbonneau talks with Jack Forehand about Justin’s participation in The March For The Fallen, a 28-mile ruck he participated in a few months ago with 35 lbs in his backpack to honor those who… Read More

Excess Returns, Episode 3: Six Common Misconceptions About Factor-Based Strategies

Factor strategies have grown exponentially in the past decade. Almost every major asset manager now offers their variation of things like value, momentum, quality, and low volatility. But to use them properly, it is important to understand what they can and can’t do. In this week’s episode, we discuss the common misconceptions about factor strategies and what they can deliver for investors.  We discuss the following myths: Factor strategies are less risky than the market… Read More

Excess Returns, Episode 2: The Rising Bar for Active Management

The market has always been tough to beat, but the ability to investors to gain inexpensive exposure to factors like value and momentum has made the job of active managers even harder. In this week’s episode, we talk about why the pursuit of alpha has become more difficult over time. We discuss: Why cheap ETFs that capture factor premiums have commoditized sources of return that used to be considered alpha How to judge the past… Read More

Excess Returns, Episode 1: The Mechanics of Value Investing

We are happy to announce the release of our new podcast Excess Returns. On each episode,  Validea partners Justin Carbonneau and Jack Forehand will talk about a wide range of investing topics with the goal of helping those who watch and listen become better long term investors, all in twenty minutes or less per episode. In our first episode, we talk about the mechanics of value investing and the many decisions that go into constructing… Read More