Quantamental investing
for everyone.
“The next frontier in investing is ‘quantamental’ stock picking…[a] merger of computing power and human expertise is lowering costs and increasing gains” [1]
-MarketWatch
“Quantitative tools are effective at keeping fundamental analysts focused on what matters by systematically removing the emotional side of investing” [2]
-Bloomberg Professional Services
“By combining the two methods—quant and fundamental—the best bits of both work together to produce a systematic method of picking stocks. The objective measures are used to create a short list of securities” [3]
-Wall Street Journal
“Quantamental is a powerful way to assess the investment process with objectivity and speed” [4]
-CFA Institute
“The quantitative hedge fund industry is on the brink of surpassing $1tn of assets under management this year after breakneck growth from…[a]n explosion of interest in automated, algorithmic investment approaches, ranging from the simple to high-octane strategies powered by artificial intelligence” [5]
-Financial Times
How it works
Every month, Stoney Point ranks a universe of large-cap U.S. stocks according to how undervalued we think each is in the stock market. We assess undervaluation by comparing the current market price of each stock to our estimate of intrinsic value. Our intrinsic value estimate is based on indicators that we believe better predict (1) the likelihood a company will experience financial stress in the future and (2) the value of a company under hyper-competitive conditions compared to traditional ubiquitous valuation approaches. Stocks that rank highly under our approach are those for which the intrinsic value, estimated using our formula, is most below the current market price (in percent). Read our thesis to learn more.
Stoney Point publishes two sets of stock picks (10 each) each month resulting from applying our algorithm to a universe of hundreds of large-cap U.S. equities:
Stoney Point’s “Prime” picks: The top 10 stocks in the universe we analyze (currently, non-financial sector S&P 500 constituents) based on our algorithm. Our Prime picks are available to subscribers only.
Stoney Point’s “Select” picks: The top 10 stocks in the universe we analyze but excluding stocks ranking in the top 2.5 percent of the universe we analyze. We offer our Select picks free of charge to everyone.
The strategy reflected in the hypothetical historical performance section of this site (and consistent with our thesis) involves constructing a portfolio comprising our picks with equal weights (1/10th of the total dollars invested in each), rebalancing the portfolio each month when a new set of picks are available.