web analytics

Another Look at Apple

September 11, 2020

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

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

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]

Market Realized Earnings & Forecasts

August 28, 2020

The S&P 500 recently crossed into new all time highs as the market shrugs off the coronavirus threat. Applied Finance’s database processes forecast data for over 20,000 companies worldwide. We decided to take a look […more]

Is the S&P 500 a Value, Core, or Growth strategy?

August 19, 2020

Is the S&P 500 a Value, Core, or Growth strategy? It depends.
The push in megacap stocks has caused index concentration to be at the highest levels since the 1970’s. Additionally, the Covid-19 pandemic and drop in interest rates has led investors to favor Growth stocks so far this year, exacerbating the trend. […more]

Growth Stocks Approaching Valuation Levels Last Observed During Tech Bubble

August 11, 2020

While we rarely make huge market calls and remain reluctant to do so at this point, its worth noting that growth stocks are trading at below -1.5 StdDev from historical normal levels signaling a significant move outside of normal range. This is especially noteworthy, as the growth relationship in the Russell 1000 is now at levels last observed in the peak of the tech bubble. […more]

Excessive Crowding of “Low Risk” Stocks: Size & Leverage Analysis

August 4, 2020

“High risk” stocks, based on smaller market caps and higher levels of leverage, outperformed the overall US market by nearly 11.4% on a cap-weighted basis in Q2. This is attributable to improving investor expectations regarding a “v-shaped” recovery following significant underperformance of “high risk” stocks in 2020 Q1 by -22.0%. […more]

Concentration Impact on Style Indices

July 30, 2020

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

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]

1 2 3 4

ValuationEdge™ Newsletter

Join to receive updates and exclusive

Valuation Driven® insights!

You have Successfully Subscribed!