Friday, April 4, 2014

The Quality Dimension of Value Investing - by Robert Novy-Marx

Link to: The Quality Dimension of Value Investing
Buying high quality assets without paying premium prices is just as much value investing as buying average quality assets at discount prices. Strategies that exploit the quality dimension of value are profitable on their own, and accounting for both dimensions of value by trading on combined quality and price signals yields dramatic performance improvements over traditional value strategies. Accounting for quality also yields significant performance improvements for investors trading momentum as well as value.

[H/T James]