Author: Yuval Taylor

The Problem with Calculating Intrinsic Value The calculation of intrinsic value has become a forbidding and abstruse practice. It seems reserved for nerds and members of the Warren Buffett cult. As Aswath Damodaran, one of its most elegant and charismatic practitioners, and perhaps the person who has promoted it more…

Roger Lowenstein’s When Genius Failed: The Rise and Fall of Long-Term Capital Management was first published in 2000 (it was republished with a new afterword in 2011) and is now considered a classic book of business history. It tells how a firm consisting of PhDs and financial wizards—including two Nobel…

This article is the third in a series about screens designed by famous investors. The first, on Benjamin Graham, can be found here; the second, on William O’Neil, can be found here; and for an overview of the subject, see my article “Can Screening for Stocks Still Generate Alpha?“ In…

There are a number of reasons why you might be interested in the future sales/revenue growth of a company. For instance, in order to perform a discounted-cash-flow analysis of a stock, it’s one of the essential inputs. Or perhaps you believe that the higher a company’s projected sales growth, the…

This article is the first in a series about screens designed by famous investors. For an overview of the subject, see my previous article, Can Screening for Stocks Still Generate Alpha? Benjamin Graham, who has often been called the father of value investing, published The Intelligent Investor in 1949 and…

This article is an overview of screening; in subsequent articles I will be doing deep dives into some classic screens such as those by Benjamin Graham, William O’Neil, Joel Greenblatt, Joseph Piotroski, and James and Patrick O’Shaughnessy. Hundreds of thousands—perhaps millions—of investors use screens as a first step to picking…

Last year I created a screen on Portfolio123 that invests in companies in the Russell 3000 that spend heavily on R&D. (To access this screen, you need to either have a Portfolio123 account or start a free trial.) There were four rules in the screen, but the most important were…

  Two Kinds of “Market Regimes” A lot of investors talk about “market regimes.” This term can have several different meanings. Classically, a market regime is characterized primarily by four measures: interest rates, inflation, GDP growth, and unemployment; often added to these are characterizations of government fiscal and monetary policy.…

(Originally posted as Why Low-Variability Investing Works) There are two kinds of volatility. One is beta; the other is variability, or fluctuation. Beta is measured by taking the correlation of a portfolio’s or stock’s returns to the market’s, multiplying it by the standard deviation of the portfolio or stock returns,…

The Reversal of the Price-to-Sales Ratio For the past few years, investors have noticed what we call a “value inversion,” which appears to be getting progressively worse. The chart below exemplifies what’s happening: Theoretically—and normally—stocks with low price-to-sales ratios (cheap stocks) outperform those with high price-to-sales ratios (expensive stocks). As…