Differences in Value

By Justin J. Carbonneau (@jjcarbonneau) —  A few weeks ago my partner, Jack Forehand (@practicalquant) wrote a piece titled “The Mechanics of Value Investing“. In it, he highlighted the various ways in which value investing can be defined. This topic was recently brought to light again in a recent tweet (see below) by Tom Psarofagis, ETF Analyst at Bloomberg. As Mr. Psarofagis points out, the underlying holdings in “value” ETFS can often be very different.… Read More

Value Investing Strategies with Good Outcomes

A recent article in The Globe and Mail shares the findings of back-testing eight different value ratios using the S&P 500 index. Specifically, the study involved creating 20-stock portfolios using names with low ratios of: price-earnings price-book value price-tangible book value price-sales price-cash flow price-free cash flow enterprise value-EBITDA The article reports, “The value portfolios won in each and every case over the full 25-year period,” offering specific returns related to the various portfolios. “The… Read More