Stock Selection and Analysis

Harvesting alpha from stock selection - top papers

The Savvy Investor Research Team has curated a wide variety of excellent papers on the stock selection process, with papers that cover valuation, risk factor models, the informal value in buybacks, size and momentum factors, earning surprise indicators and others.

Here is a taster of a few papers, but please click through for the full list of stock selection papers.

1. Combining Risk Factors For Superior Returns (Northern Trust)

In this excellent 2013 paper, the author describes the four most widely used company valuation methods. He comments on the conceptual correctness of each of these and advises how most effectively to use them.

2. Do Share Repurchase Announcements Lead to Higher Returns? (S&P Capital IQ)

A wealth of academic research has been conducted over the years on the information content of buyback announcements and their effect on shareholder value. This paper by S&P Capital IQ uses original research to conclude that share buybacks do indeed have informational value in predicting future returns.

3. Size Matters, If You Control Your Junk (Cliff Asness et al)

In this report, the authors combine a deep dive into the academic literature in the area of equity valuation with their own analysis to try to identify the best approach to value screening.