Show HN: Invest systematically in deeply undervalued companies

We&#x27;re in the era of disruptive innovation, where whole industries get gutted and replaced by the next big thing. For example, the iPhone disrupted a long tail of physical gadgets, from voice recorders to rulers, calendars and Rolodexes. Amazon disrupted retail and on-premise enterprise computing. Tesla is disrupting the automakers, energy companies, ride-sharing networks, etc., all while transitioning us to carbon-free energy. Square + Bitcoin is disrupting the banks, payday lenders, small business accounting, etc.<p>The returns I&#x27;ve gotten investing in disruptive innovation, just since March, have yielded many times the returns of the S&amp;P 500.<p>(See also this argument against value investing: <a href="https:&#x2F;&#x2F;www.youtube.com&#x2F;watch?v=2A-TVLyYY9c" rel="nofollow">https:&#x2F;&#x2F;www.youtube.com&#x2F;watch?v=2A-TVLyYY9c</a>)<p>How is &quot;value investing&quot; not going to just lose a lot of opportunity in the roaring 2020s? It is obvious, and widely known that the Fed Put is going to continue for years. What is special about the <i>particular</i> companies that Gemalpha invests in, and why should I trust that?

How can you be confident these companies are undervalued? I feel like if you really had a good system, you could capitalize heavily directly by taking aggressive options positions in them.<p>Making a claim like &quot;these companies are undervalued&quot; requires strong evidence, in a field so rife with bogus claims.

Unfortunately, the same rule that applies to shorting overpriced companies (&quot;The market can remain irrational longer than you can remain solvent&quot;) also applies to going long on underpriced ones. They can remain underpriced indefinitely.<p>The formula is reasonably well founded, as far as it goes. Take the cash and debt into account, figure that as a ratio to past revenue, and you can figure out what a stock &quot;should&quot; be worth -- if its revenue persists.<p>But the stock price may not reflect that for a lot of reasons. A value investor should look into the market, management, and other broader conditions as well. This is a decent metric to start with -- one that you kinda don&#x27;t need to pay them $200 a year for. Especially since a value investor would buy and hold.

I think you have typo at <a href="https:&#x2F;&#x2F;www.gemalpha.com&#x2F;#backtest" rel="nofollow">https:&#x2F;&#x2F;www.gemalpha.com&#x2F;#backtest</a><p>It should be &quot;Max drawdown&quot; instead of &quot;Max drowdown&quot;.

If this works so well, why are you offering it to other people?