The Advantages of Quantitative Approaches to Stock Selection

by AAII Staff | June 05, 2019

 

 
 
Tricking Investors With Merger-Related Accounting Shenanigans

Acquisitions give managers opportunities to boost performance artificially or hide past mistakes. Learn how to spot these shenanigans, including seven categories of earnings manipulation.   More »
   
Price-Sales Ratios: A New Tool for Measuring Stock Popularity
 
Ken Fisher proposed a substitute to the price-earnings ratio in the June 1984 AAII Journal, introducing members to the now-common ratio based on price relative to sales. The formula is like that of the price-earnings ratio, except it uses sales instead of earnings. To calculate a stock’s price-sales ratio, you divide its price by its sales per share.   More »
Ken Fisher
 
 
The Advantages of Quantitative Approaches to Stock Selection
 
Quantitative strategies allow thousands of stocks to be ranked by specific characteristics, such as value or momentum. This is an interview with Sudhir Nanda, the head of T. Rowe Price’s Quantitative Equity Group as well as a portfolio manager for the company’s QM U.S. Small-Cap Growth Equity Fund (PRDSX) and QM Global Equity Fund (TQGEX) mutual funds, discussing his approach and what individual investors can learn from it.   More »
 
 
 
 
Why Technical Analysis Matters
 
At its core, technical analysis is simply a method of determining if a stock or the market as a whole is worth buying or selling. Once we identify this, we are way ahead of the game about assembling a winning portfolio. Chart watching can help investors make better decisions. A five-step process can take a stock from an idea to a decision to buy or sell.   More »
 
 
 
 
Member Question 
What is the most important financial problem facing your family today? 
A) Health care costs 
B) Lack of money/low wages 
C) College expenses 
D) Cost of owning/renting a home 
E) Taxes 
F) Too much debt/not enough money to pay debts 
G) High cost of living/inflation 
H) Retirement savings 
I) Unemployment/loss of job 
J) Social Security 
K) Lack of savings 
L) Interest rates 
M) Transportation/commuting costs 
vote now
Be sure to vote on this week’s question for the opportunity to offer your insights on our open-ended question.


Previous Week’s Results 
In the past 24 months, have you moved any of your cash to an online bank that pays higher yields on savings and money market accounts? 

No : 70%
 
Yes : 30%
 

Poll results are as of 9 a.m. (Central) on Monday. 1,555 respondents. 



 
 
AAII Survey: Many Retail Investors Missing Out on Higher Banking Interest Online
   
  Many online banks offer interest rates that are higher than those found at traditional brick-and-mortar banks. Are our readers taking advantage of those higher rates? That is what last week’s member question set to find out. We then asked a special question as to why our readers may not be making the switch to an online bank.   More »
 
 
 
 
Stock Investing Strategies
   
  One of the biggest difficulties for individuals interested in investing in stocks is getting started. This AAII e-book provides a general outline for analyzing stocks and walks through the process as it is practically applied to specific types of investment approaches. It first describes, in very broad terms, the basic process that is followed in fundamental analysis. It then goes into the various steps in more detail and shows how they can be adapted and practically applied to an individual’s specific approach using commonly found information sources.  More »

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