For Whitman, Value Still Rules

Value investing legend Marty Whitman built his reputation by buying down-and-out stocks. And today, he says he still believes that’s the way to go. “You’re trying to figure out what the masses think are going to happen to the securities’ prices. Stock markets can be capricious,” Whitman tells Forbes. By investing in out-of-favor sectors of […]

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Low-P/E Stocks That Pass An Accountant’s Tests

In his latest column for Forbes.com, Validea CEO John Reese takes a look at how to go beyond the P/E ratio when looking for cheap stocks. “P/E ratios are useful tool, but they are by no means the be-all and end-all when it comes to gauging the valuation and attractiveness of a stock. In fact, […]

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OSAM: How To Win In Emerging Markets

Emerging markets can make for enticing investments, and new research from James O’Shaughnessy’s firm shows how fundamental-focused investors can really take advantage of EM opportunities. “U.S. investors, and other investors around the world, tend to overweight their home country in their equity portfolio,” write O’Shaughnessy Asset Management’s Patrick O’Shaughnessy and Ashvin Viswanathan in a report […]

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Guru Strategy Ratings: IBM, TYC on the Move

Each week, we take a look at which stocks John Reese’s Validea.com Guru Strategy computer models have newfound interest in, and which they have soured on. Here’s a look at some of the stocks John’s strategies have upgraded or downgraded today.

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In The Market, Boring Beats Exciting …

Investors are very often drawn to flashy, exciting stocks — those that exhibit the most volatility. But, says Mark Hulbert, they should be doing the exact opposite. “That is because ‘boring’ stocks — those that have exhibited the least historical volatility — on average outperform the most ‘exciting’ issues — those that have been the […]

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… Or Does It?

In our previous post, we highlighted the “low-volatility effect” — the historical tendency for lower-volatility stocks to outperform higher-volatility issues. But IndexUniverse’s Elisabeth Kashner says the issue may be more complex than the simple notion that low volatility leads to better returns. Recently, Kashner says, low-volatility strategies have lagged. Part of that is a result […]

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Investors And The “Trifecta Of Failure”

What separates great investors from the rest? The Motley Fool’s Morgan Housel says it has to do not with financial acumen, but instead with psychological prowess. While most investors are “mental catastrophes” the great ones “are masters of psychology,” Housel writes (h/t to The Big Picture). “They can’t control the market, but they have complete […]

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Sonders On What The Bond Rise Means For Stocks

Charles Schwab Chief Investment Strategist Liz Ann Sonders says the recent rise in bond yields doesn’t mean stocks are headed for trouble. When rates start to rise, Sonders says, ”the real bite on stocks” typically doesn’t hit for “quite some time”. Sonders — who says it’s tough to say whether the recent increase in yields is […]

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Ritholtz: It’s Not Just About The Fed

Barry Ritholtz of FusionIQ and The Big Picture blog says that investors need to realize that, while the Federal Reserve is getting all the attention, other factors are also driving the stock market right now. “We have very low inflation, we have no upward pressure in wages, and we have earnings, corporate earnings, at record […]

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Keep It Simple (But Not Too Simple)

Listen to many market pundits and prognosticators, and they will make the stock market seem like a completely understandable world that, with time and dedication, can be mastered. But in a great piece on his Above The Market blog, Robert Seawright says that neither overly simplistic theories nor incredibly complex ones will give you all […]

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Guru Strategy Ratings: P&G, Petrobras on the Move

Each week, we take a look at which stocks John Reese’s Validea.com Guru Strategy computer models have newfound interest in, and which they have soured on. Here’s a look at some of the stocks John’s strategies have upgraded or downgraded today.

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Why Are Bond Rates Rising?

Long-term interest rates have been rising, and on his New York Times blog Paul Krugman offers his take on why. Krugman says an increase in long-term rates usually results from one of three scenarios: “One is that the bond vigilantes have arrived, and are selling US debt because they now believe in the horror stories. […]

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The Fed & The Equity Risk Premium

While the equity risk premium is currently quite high by historical standards, New York University professor Aswath Damodaran says that might not be an indication that stocks are cheap. In a post on his “Musings on Markets” blog, Damodaran notes that the equity risk premium (the spread between the risk-free rate and expected stock returns) […]

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