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About Applied Finance

Applied Finance, a thought leader in valuation and portfolio construction, is a true “value” investment management company.  Unlike the majority of firms today that focus on low multiples to define “value”, we define value as identifying companies trading below their intrinsic value.  Our Valuation Driven™ approach forms the foundation of our investment decisions…more

Another Look at Apple

September 11, 2020 Applied Finance

The reign of Tim Cook at apple has been extraordinary with the company’s valuation growing 5x larger on his watch. Deservedly, there has been little criticism of the cash returned through stock buybacks (~$340 Billion […more]

Understanding Recent Option Activity

September 10, 2020 Applied Finance

Recent reports attribute the market’s recent melt-up to option buying activity from Japanese institutional giant SoftBank and unsophisticated American traders using the new commission free platform, Robinhood. Without divining on whether these explanations are clever, […more]

Market in Pictures – August 2020

September 2, 2020 Applied Finance

For August 2020, we highlight the importance to productivity of waking up properly, the plight and pain of traditional value managers, a must-read white paper on value investing and technology and several other trending topics […more]

Concentration Impact on Style Indices

July 30, 2020 Applied Finance

Big 5 companies surge in index concentration… what will be the effect on style boxes and cap-weighted portfolios?

The recent surge has notable impacts on commonly-used style index construction methodologies. Due to the increased reliance on passive allocations, investors should be aware of the significant distortions regarding style index diversification and skews in the classification assigned to individual stocks. […more]

The False Bargain of Passive Investing

July 14, 2020 Applied Finance

Today the irony continues, as the intellectual foundations in financial economics that underpinned Bogle’s incredible success are much less robust than they appeared in the early 70’s, yet the push for passive investing is stronger and more fervent than ever. For proactive, process-oriented, intelligent advisors this will create a great opportunity to distinguish yourself from the growing herd of “commodity” advisors who preach little more than fee minimization, rather than alpha generation or negative alpha avoidance. […more]

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