Using criteria based on environmental, social and governance (ESG) considerations has become an increasingly important aspect of investment decision making, particularly for high profile institutional investors. As of 2019, sustainable assets under management were estimated to be $30 trillion worldwide. …
It is often said that once you have a hammer, everything looks like a nail. So be it with the big market delusion. Since Aswath Damodaran and I published our article “The Big Market Delusion,” evidence of the delusion has…
In a previous post, I described a new index introduced by the Cornell Capital Group called the CCG Quarantine Index. The index tracks the performance of the stocks that are likely to benefit from the fact that millions of people…
Up through the end of 2006, one of the most widely reported results in empirical studies of investing was the so-called “value effect” which stated that value stocks tended to outperform growth stocks. As a quick review, a growth stock…
Bradford Cornell and Aswath Damodaran In the last decade, companies have come under pressure to be socially conscious and environmentally responsible, with the pressure coming sometimes from politicians, regulators and interest groups, and sometimes from investors. The argument that corporate…
Interpreting movements in the stock market is difficult enough in normal times. The Covid-19 crisis has made it all the more difficult with the market lurching up and down as it attempts to process news about the virus and its…
I have written about the problem of valuing the S&P 500 in previous columns, but the issue is so important it is worth revisiting one more time. After all, the overall level of the market is the tide which raises…
It is one thing to say that the market is volatile. It is quite another to appreciate fully what that really means. So let’s spend a moment to dissect volatility. The Current Level Of Volatility The first thing to make…
Abstract: The performance of Renaissance Technologies’ Medallion fund provides the ultimate counterexample to the hypothesis of market efficiency. Over the period from the start of trading in 1988 to 2018, $100 invested in Medallion would have grown to $398.7 million,…
https://www.valuewalk.com/2020/01/big-market-delusion/ Soon after its introduction as a private company, the market value of Uber began to explode. One reason was the potential size of the market. Uber was billed not only as a potential global ride sharing company, but as…