Posts Tagged: value investing

O’Doul’s Part 2

I posted the other day about fundamental indexation being the O’Doul’s of value investing, because it is just the first step away from a market cap weighted index and towards a more differentiated value portfolio. I received lots of emails about the post, so figured I would spend more than 20 minutes on the time series…

How Concentrated Should You Make Your Value Portfolio?

To take advantage of value investing, you need a smaller portfolio than you may think. I was curious to see what different levels of portfolio concentration would have produced in a value-only portfolio over the past 50 years, and report the results here.   I set up portfolios which bought the absolute cheapest stocks trading…

Tech stocks CAN be great

Value investing has been the most consistent way to outperform the market for decades. It continues to work because it forces you to buy stocks for which the market has very low expectations (expectations which often turn out to be overly pessimistic). People are overly sensitive to losses and often shun value stocks. But what…

Searching for Deep Value Stocks

Deep value investing is a powerful way to beat the market, but deep value stocks are an endangered species in the U.S. I was recently talking with Tobias Carlisle, author of Deep Value: Why Activist Investors and Other Contrarians Battle for Control of Losing Corporations, about what constitutes a deep value stock. To find these…

Two Ways To Improve The Momentum Strategy

Momentum investing worked very well in 2013, but it’s been awful in 2014. The momentum reversal has been one of the major headlines in an otherwise flat and quiet market year because the high-flying stocks from 2013, especially popular tech names like Tesla, have been crushed in recent months. Momentum investing works great over the…

The Five Year Market Metamorphosis

The U.S. market has gotten much more expensive in the past five years following the incredible buying opportunity in 2009.  One great valuation measure is EBITDA (earnings before interest, depreciation, and amortization) divided by Enterprise Value (sometimes called ‘takeover value’, calculated as market value of a company, plus debt, minus cash). I’ll shorten the name…

Warren Buffett and the Banana Man

Had a Chiquita banana lately? I was amazed to learn the remarkable story behind the brand, which began in 1911 with a company called Cuyamel Fruit Company and a Russian immigrant named Sam Zemurray. Sam (aka “Sam the banana man”) was a remarkable businessman who personified the American dream, but also exposed some of the…