Their conclusions are surprising and counter-intuitive. Gray and Carlisle look at long term returns on capital and assets, free cash flow, and a variety of metrics related to margins and general financial strength.ģ) The secret to finding deeply undervalued Does the price-to-earnings ratio find undervalued stocks better than free cash flow? Gray and Carlisle examine the historical data on over 50 valuation ratios, including some unusual metrics, rare multi-year averages, and uncommon combinations.Ĥ) The five signals sent by smart The book uncovers the signals sent by insiders, short sellers, shareholder activists and institutional investment managers.Īfter detailing the quantitative value investment process, Gray and Carlisle conduct a historical test of the resulting quantitative value model.

As the authors explain, the quantitative value strategy offers a superior way to capture the benefits of a value investing philosophy without the behavioral errors associated with 'stock picking.' To demystify their innovative approach, Gray and Carlisle outline the framework for quantitative value investing, including the four key elements the investmentġ) How to avoid stocks that can cause a permanent loss of Learn how to uncover financial statement manipulation, fraud, and financial distress.Ģ) How to find stocks with the highest Learn how to find strong economic franchises, and robust financial strength. In Quantitative Value, Wesley Gray and Tobias Carlisle take the best aspects from the disciplines of value investing and quantitative investing and apply them to a completely unique and winning approach to stock selection. While Buffett and Thorp have conflicting philosophical approaches, they agree that the market is beatable. A must-read book on the quantitative value investment strategy Legendary investment gurus Warren Buffett and Ed Thorp represent different ends of the investing one a value investor, the other a quant.

Only Human by Wesley Gray