Quantifying The Value Premium Across Asset Classes

Value is arguably the leading exhibit in the factor zoo. Quantifying the value factor is challenging, however, for multi-asset class portfolios for at least two reasons. Commodities aren’t easily valued because oil, gold, etc. don’t generate earnings or dividends. Even when there are cash flows to measure, putting a broad set of assets on a level playing field is difficult, perhaps impossible, if we use traditional valuation metrics, such as book value, price-earnings ratio, etc. Measuring valuation for real estate investment trusts (REITs), for instance, requires a different procedure vs. stocks, which is different from bonds. A solution (or at least a partial solution) that applies to everything is estimating valuation using return.
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Book Bits | 21 April 2017

Upside: Profiting from the Profound Demographic Shifts Ahead
By Kenneth W. Gronbach with M.J. Moye
Interview with author via BlogCritics.org
Q: Your book is about predicting the future with accuracy. Can you explain why demographics provide clear evidence of where we’re headed?
A: Demographics precipitates economics — not the other way around. Commerce is reliant on market size, and market size is determined by demographics. Cultural shifts are determined by demographic changes. Demography is dependent on live births, deaths and migration, and so is politics. People are easy to count. It is math. So much of what people influence is determined by their number, their age, and where they are.
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