The Strengths and Weaknesses of the Major Value Metrics

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By Jack Forehand and Justin Carbonneau, Jack Forehand, and Justin Carbonneau. Discovered by Player FM and our community — copyright is owned by the publisher, not Player FM, and audio is streamed directly from their servers. Hit the Subscribe button to track updates in Player FM, or paste the feed URL into other podcast apps.

Many investors think all value strategies are fairly similar to each other. And as a result they expect the value funds they invest in will all perform similarly over time. But the reality is that the behind the scenes details that go into building a value strategy can play a major role in how it performs and lead to major deviations in performance among value funds. In this episode, we take a look at one way that value strategies can differ - the metric they use to define value. We look at the major value metrics and the pros and cons of each of them. We also look at the construction of value composites and why their benefit might come from a different source than the one you think.

We hope you enjoy the discussion.

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Excess Returns is an investing podcast hosted by Jack Forehand (@practicalquant) and Justin Carbonneau (@jjcarbonneau), partners at Validea. Justin and Jack discuss a wide range of investing topics including factor investing, value investing, momentum investing, multi-factor investing, trend following, market valuation and more with the goal of helping those who watch and listen become better long term investors.

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102 episodes