Invest Like the Best with Patrick O'Shaughnessy Jim O’Shaughnessy - Premeditated Success - [Invest Like the Best, EP.29]
9 snips
Mar 21, 2017 AI Snips
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Early Hands-On Valuation Experiments
- Jim O'Shaughnessy tested valuation metrics by hand as a teenager using Dow components and tracked p/e, price-to-book and dividend yield.
- He found low p/e and high dividend yield stocks consistently outperformed over rolling five- and ten-year periods.
Stick To Your Strategy During Drawdowns
- Stick to your quantitative strategy even when it underperforms because emotional deviations destroy long-term results.
- If you cannot master emotions, consider indexing to avoid self-sabotage.
Consistency Trumps Complexity
- Many quant managers violate their models during stress, which negates their track records.
- Consistency and persistence in applying factors is the primary source of long-term outperformance.