Making Friends With Bear Markets

If you are trying to avoid the next bear market, Validea CEO John P. Reese has some advice: Stop trying to avoid the next bear market. In a piece for Forbes.com, Reese cites a recent column from Mark Hulbert, who monitors the performance of hundreds of investment advisors through his Hulbert Financial Digest. Hulbert says that over the past 15 years the best performers have been those who have stayed the course through bear markets. Those advisors he tracks who by and large avoided stocks during either the 2007-2009 or 2000-2002 bear market – when stocks were pummeled – are […]

Apple vs. Google, and Other Market “Playoff” Matchups

With the NCAA’s college football playoff only a couple weeks away, Validea CEO John Reese recently took a look at some stock market “playoff” matchups that feature several global powerhouses, including Apple, Coca-Cola, and Google. In a column for Forbes.com, Reese looks at how four pairs of market rivals stack up against each other. The matchups: Apple vs. Google, PepsiCo vs. Coca-Cola, Exxon Mobil vs. Chevron, and Anheuser-Busch InBev vs. Molson Coors. Reese uses his Guru Strategies to analyze each firm on a purely quantitative basis. “The numbers might not tell you everything, but they tell you more than you […]

Be Like Buffett: Go Low — Low-Beta, That Is

Conventional wisdom has long held that, in investing, greater risk leads to greater reward. But over the past couple years, new research has turned that idea on its head, and in his most recent Seeking Alpha article, Validea CEO John Reese looks at some of the implications for investors. “In Betting Against Beta, Andrea Frazzini and Lasse Pedersen found that [Warren] Buffett’s Berkshire Hathaway has beaten the market over the long haul by focusing on low-beta stocks, and using leverage – other people’s money – when buying them,” Reese says. “Most investors can’t use large amounts of leverage, however. Instead, […]

When It Comes To Growth Or Value, Have Your Cake And Eat It Too

It’s extremely common to hear investment commentators talk about “growth” and “value” as though they are polar opposites. But Validea CEO John Reese says not to buy that false notion. “When it comes to investing’s great ‘either/or’ – that is, the growth or value debate – you can have your cake and eat it, too,” Reese writes for Canada’s Globe and Mail. “That’s because the great growth versus value debate is, in fact, a false choice. … Confining yourself to either value stocks or growth stocks is only limiting your portfolio’s potential. At certain times, you’ll be able to find […]

Would Lynch, Buffett, and Graham Like Apple, Facebook, and GE?

How do Apple, Facebook, Berkshire Hathaway, and other market giants stack up against the strategies used by history’s greatest investors? In his latest column for Forbes.com, Validea CEO John P. Reese takes a look at how 10 market titans fare, and the results might surprise you. Reese notes that, historically, small stocks have beaten large stocks by a significant margin. Small stocks have an advantage because they can fly under the radar in a way that larger stocks cannot, and they usually come with an added risk premium because they tend to be less stable and more susceptible to bankruptcy. […]