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Building a Comprehensive Stock Valuation Ratio with Machine Learning

1 pointsby scottrogowskiover 4 years ago

1 comment

Bostonianover 4 years ago
Interesting project, but it has not worked to select stocks over the short time period considered. Below, FFER is his ratio of market value to fundamental fair value, so a high FFER indicates a stock is overvalued and should fall. Of course, value investing has done badly for many years.<p>&quot;I have tried using backdated FFERs to predict future returns. The results are the opposite of what I would have expected. While the relationship is somewhat weak, stocks with higher historical FFERs tend to generate better returns.&quot;