Hot List Newsletter

Most Recent Hot List Issues

3 most recent issues require subscription. Historical issues can be viewed free of charge.


Validea Hot List

The Ups and the Downs of Avoiding Value Traps

The problem with value investing, other than that it can go through long periods of underperformance as the strategy has suffered under lately, is that some stocks are cheap for a reason. It's not that they are hidden or overlooked gems just waiting to be discovered. It's that there is something fundamentally flawed. The trick, of course, is figuring out whether you have a bargain or a dud.


Validea Hot List

Process, Not Politics

The coming period will thus be dangerous for many investors, who have been lulled into complacency during an unprecedented decade-long bull run that seems to have no end in sight. The danger, rather, is that every day the bull market continues, those investors will be more and more tempted to pile in in a "fear of missing out" frenzy. And if they do bail and markets do fall, they will be tempted to stay on the sidelines far longer than they should, missing out on a major portion of the rebound. Read our latest issue to see how to focus on process and combat these emotional reactions.


Validea Hot List

Mentally Preparing For the Next Bear Market

Hoping for the best but preparing for the worst is a good rule-of-thumb, a maxim that can help us stay measured and mindful when it comes to dealing with life's inevitable ups and downs. But it can be hard to think about potential downs when the ups have been around for a while--and the current, nearly nine-year-old bull market is a perfect example of that.


Validea Hot List

Common Mistakes in Factor Investing

Most investors hate admitting mistakes, but those are often the most valuable lessons. Even the world's savviest of investors make them. Avoiding mistakes is not possible in investing. Learning from your mistakes is the key to long-term success.


Validea Hot List

Don't Give Up On Value Just Yet

Value investors have reason to be impatient. Growth stocks have been clobbering value stocks for some time, and this prolonged bull market and growth stock rally has left even jaded professionals wondering whether the game has completely changed. Despite tech stocks' dazzling performance giving growth stocks a good name these days, it is value stocks that consistently win over a far longer period of time.


Validea Hot List

The Difference Between What Sells and What Works

There is a disconnect in the asset management industry. The products that are the most effective at drawing in new investors are not the products that produce the best investor returns. In this issue, we take a look at some advertising tricks you should keep an eye out for.


Validea Hot List

How to Keep Investing Perspective

Learning how to tune out the noise and focus on what matters is the biggest challenge in investing. Investors have to overcome the temptation to dwell on the short-term when it's the long-term view that matters. They have to have the discipline to stick to a strategy even if it appears to be faltering at the moment. Success comes with setting clear goals and tuning out the distractions.


Validea Hot List

What Gambling Can Teach Us About Process

One of the biggest mistakes investors make is valuing outcome over process, particularly giving significant weight to outcomes over short periods of time. When an investment manager does well over one, three, or five-year periods, investors flock to them and their assets under management rise. But things almost always end badly for those performance chasing investors.


Validea Hot List

The Role of Inconsistency in Outperformance

No investment model can beat the market every year. We have studied many factor-based investment models and one rule applies to every one of them. Inconsistency is what investors have to endure in the short run to beat the market over the longer term.


Validea Hot List

Graham's Most Important Contribution

Many consider the value approach to picking stocks Benjamin Graham's most important contribution to investing, but in actuality it may be something different entirely. Check out our latest newsletter to see what Graham's biggest lesson was.


Validea Hot List

Become an Equity Compounder like Buffett

It's a simple concept, but over time, it accomplishes extraordinary things. That's how legendary investor and stock market guru Warren Buffett has described compound interest, a concept that Albert Einstein called the "eighth wonder of the world."


Validea Hot List

Lessons from Buffett's Annual Letter

Warren Buffett's annual letter to shareholders is an opportunity for investors to remind themselves of some valuable lessons. This year's letter contained insights on whether Buffett is seeing value in the market, on update on his bet that the S&P 500 would outperform a basket of hedge funds, and his views on the use of leverage. Our latest newsletter offers our take on the most valuable lessons from the letter.


Validea Hot List

The Pros and Cons of Buying Market Dips

Warren Buffett always says that investors should be fearful when others are greedy and greedy when others are fearful. But does buying during market declines really enhance returns over time? Check out our latest newsletter to get the facts.


Validea Hot List

Three Mantras for Investors

Last year was an anomaly. There hasn't ever been a year like 2017, when the S&P 500 rose each month. Investors tend to believe that the most recent results are what will happen in the future. But that can be dangerous. Warren Buffett has famously said investors should be "fearful when others are greedy and greedy when others are fearful." So betting on a continuation of that low volatility was inevitably going to be a losing bet, at least eventually.


Validea Hot List

Looking at a Potential Value Rebound

It may be hard to remember, but at one point more than a decade ago, value stocks were in favor. Since, then growth stocks have dominated, led by the FAANG stocks. But the catalyst the could change things could be coming soon. Our latest newsletter explores the current situation with value, and why things might be changing.


Validea Hot List

Lessons From 2017

Despite lots of talk about the bull market nearing its end and signals pointing to a correction in the near-term, stocks were up strongly in 2017 and have continued those gains this year. But just because things have gone smoothly for the market, that doesn't mean there aren't lessons to be learned. In this week's newsletter, we take a look at some of them.


Validea Hot List

2017 Year in Review

With 2017 coming to a close, it is time to look at what worked for the year, and what didn't. Overall the year was dominated by large-cap technology names, with growth strategies dominating value and large-caps beating small-caps. But those trends don't tell the whole story. Check out our latest issue to see how our guru models performed for the year.


Validea Hot List

Pick a Star or Develop a Process

It's difficult to draw a direct relationship between skill and outcome, especially in investing. Even the best managers will underperform for a period of time during their careers, usually coinciding with buoyant markets, such as we see today. Winners are measured in decades, not months.


Validea Hot List

The Two Most Important Investing Decisions

Investors tend to get bogged down with detailed decisions. But the most important decisions are far more fundamental than that. Get the two most important decisions right, with realistic expectations, and success will follow. Check out our latest issue to find out what they are.


Validea Hot List

The Only Constant in Investing is Change

In investing, there will always be a new flavor of the month and a new fashionable strategy. But investors would be better served developing a plan that makes sense for them and sticking to it over the long run, rather than trying to chase performance.


Validea Hot List

The Dangers of Expecting the Past to Repeat Itself

It's natural to commemorate big anniversaries and look back at historic market events and compare them to where things stand in the present day. Many have been doing exactly that with the 1987 crash recently. But assuming any market will play out exactly like any past market is just setting yourself up for failure. Check out our latest to see how you can best learn from the past.


Validea Hot List

How Human Behavior Affects Investing

University of Chicago professor Richard Thaler has been awarded the Nobel Prize in economics, for, as his friends have said, revolutionizing how economists think about people. Indeed the dismal science isn't just about numbers. It is about how humans react to the economic environment.


Validea Hot List

Why Disciplined Investment Strategies are Best

Imagine a scenario in which you're unsure about directions, so you ask a friend if you could follow him in your car. He happily agrees, then tells you to turn right a mile before he does. In some ways, talk about strategies to protect investors from "black swan" events-negative occurrences that lead to significant market declines--is similarly puzzling.


Validea Hot List

David Dreman and Investor Psychology

Psychologists have begun to recognize and understand the critical role Affect plays in people's decision-making and the manner in which our minds tag representations of objects or events with positive or negative feelings. In order to combat the impact Affect has on your decision-making processes, of course, you have to recognize it. Check out our latest newsletter to see how and how to defend against it.


Validea Hot List

Go Back to School on your Investment Portfolio

Do you have a solid, go-to approach that is aligned with your risk profile and future goals? Are you sticking to that approach no matter what you hear on television or from friends and family? If not, these are questions that deserve your attention. Our latest newsletter gives you some ideas.