There's a saying from Winston Churchill, "Never let a good crisis go to waste", and while the news around the Reddit message board, r/wallstreetbets, and GameStop may not be a crisis per se, it certainly is something that has turned markets upside down, caused confusion among most main street investors, ravaged some multi-billion hedge funds, rewarded some nimble traders and hurt many others who got in too late.
When you look at the long-term performance data of the major investing factors, value and momentum typically rise above the rest. A few weeks ago, we began our look at the basics of factor investing by taking a look at momentum. In this article, I will take a look at the principles of value investing.
The rapid rise and fall of GameStop earlier this year was unlike anything many of us have seen in our investing careers. The stock's price went from the single digits to upwards of $400 per share in a very short time, and then lost most its value in the weeks that followed. In this episode, we take a look behind the scenes at the factors that led to GameStop's massive gains, and how those same factors eventually led to the ensuing decline We also take a look at some lessons investors can learn from the GameStop saga.
Risk is one of the most difficult concepts in investing to define. Part of that is because we face many risks as investors that come from many different directions. But another part of it is that risk is ultimately different for every investor, which makes a universal definition impossible to find.
In this episode, we look at some of the most important risks we face as investors, and why they are impossible to disentangle from our own behavior. We also look at some practical ways we use to measure risk to help optimize results for the focused factor-based strategies we follow.
Validea is an incredible valuable tool to have. I depend on it for much of my research to help weed out stocks for my portfolio designs. The filters used for stock selection are easy to use and comes with a detailed analysis
as to the why each particular stock either passes or fails the test. The articles & blogs are a great wealth of knowledge too.
As a retail investor, I particularly value Validea’s top-notch research capability. With the deluge of investment commentary available via innumerable blogs, articles, FinTwits, white papers, podcasts, etc., the Validea team is one of my go-to sources to maintain some perspective
on what's really happening.
I am always checking my investment/trading ideas with Validea. I feel better knowing that any of the guru models they are following might also be on my side!
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