Post #1587 by rrr12345 on the Mechanical Investing board

When reading posts, there are yellow stars against the names of the most respected Shrewds. The number of points in the star, starting at 3, represents the Shrewd'm-Star rating. This number is the average recommendation that the author received over the last 12 months.

- Manlobbi

Investment Strategies / Mechanical Investing

Unthreaded | Threaded | Whole Thread (7)

Prev | Next

Post New | Post Reply | Report Post | Recommend It!

No. of Recommendations: 4

I'd use book value per share (BVPS). BVPS captures all earnings, including both realized and unrealized capital gains. While it's true that stock repurchases distort IV/BV slightly, this distortion is small quantitatively. Book value by IFRS rather than GAAP would be somewhat better because IFRS carries properties at market value rather than cost less depreciation, but this distortion is also relatively small. One unknown when calculating IV growth using BVPS is how fast IV/BV is increasing, but the increase in IV/BV tends to be quite slow. BV growth is also less volatile than earnings growth simply because of the large denominator. Just my two cents.

Post New | Post Reply | Report Post | Recommend It!

Print the post

Unthreaded | Threaded | Whole Thread (7)

Prev | Next

Announcements

Mechanical Investing FAQ

Contact Shrewd'm
Contact the developer of these message boards.

A community forum supporting civilized, and highly helpful, self-educating investors that come together for Shrewdness and merry spirits. These message boards closely follow the look and feel of the old message boards at boards.fool.com prior to the boards redirected to discussion.fool.com. Shrewd'm is not affiliated with the comprehensive and excellent investment website, The Motley Fool (TMF), in any way. The Shrewd commmunity here has owed, and continues to owe, gratitude to The Motley Fool for nurturing a culture of jovial irreverence towards Wall St, and that tradition will continue here.