Quantitative Value

Quantitative Value book coverI recently started reading Quantitative Value: A Practitioner’s Guide to Automating Intelligent Investment and Eliminating Behavioral Errors ($) by Wesley R. Gray and Tobias E. Carlisle.  Both of the authors are fellow value investors who blog. Tobias Carlisle runs Greenbackd and Wesley Gray writes the Turnkey Analyst blog.  I’ve followed both of their blogs for several years. I’m very excited to share this book with you.

I first met Wes Gray when he became one of the early members of Fat Pitch Financials Contributors Corner years ago. While he was a member he caught my attention when he mentioned he was deploying to Iraq. We exchanged emails a few times in the past and I started reading his blog soon after it first started. When I learned of his book, I knew it would definitely be worth reading and I had to get it.

I plan on discussing each of the chapters of Quantitative Value. Those chapters are as follows:

Quantitative Value Chapters

  1. The Paradox of Dumb Money
  2. A Blueprint to a Better Quantitative Value Strategy
  3. Hornswoggled! Eliminating Earnings Manipulators and Outright Frauds
  4. Measuring the Risk of Financial Distress: How to Avoid the Sick Men of the Stock Market
  5. Franchises – The Archetype of High Quality
  6. Financial Strength: Foundations Built on Rock
  7. Price Ratios: A Horse Race
  8. Alternative Price Measures – Normalized Earnings Power and Composite Ratios
  9. Blue Horseshoe Loves Anacott Steel: Follow the Signals from the Smart Money
  10. Bangladeshi Butter Production Predicts the S&P 500 Close
  11. Problems with the Magic Formula
  12. Quantitative Value Beats the Market

I’ll be sure to link to each of my chapter reviews as I post them. My review will include my own independent backtests of many of the quantitative methods discussed in Gray and Carlisle’s book. I’ll conduct my analyses using the Portfolio123 tool. It will be interesting to see if I can replicate many of the amazing performance numbers reported in this interesting book.

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