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Value Investing Retrospective

A portfolio strategy that select stocks with strong value characteristics, e.g. book to market ratio, has on average outperformed overall market and growth stocks. For example, one dollar invested in large value stocks in 1965 was worth $177 at the end of 2005. A similar investment in the overall market would be worth only 57 dollars.

The Value Investing Retrospective was written by Goldman Sachs Vice President Andrew Dubinsky when he was a PhD candidate at the Columbia Business School.

The one dollar investment in small value stocks was worth 919 dollars!

This project will briefly summarize the findings in academic papers about value-oriented stock-selection methods from the past two decades. The papers will review the success of the value strategies in the US data in small and large stocks and international stock data as well. The information provided here is meant to provide an entry point to the empirical value studies past and present.

Download the Value Investing Retrospective (PDF, 12MB)