O'Reilly logo

The Essential P/E: Understanding the stock market through the price-earnings ratio by Keith Anderson

Stay ahead with the world's most comprehensive technology and business learning platform.

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, tutorials, and more.

Start Free Trial

No credit card required

Chapter 8. Value Investors Fight Back

I have looked at the F&F 3-factor model in much more detail than the CAPM or APT because it is the most widely accepted model of stock returns today, at least in the academic finance world. There are plenty of doubters who do not feel it explains everything however.

The best-known of these papers, Lakonishok, Shleifer and Vishny in 1994 (LSV), came out only one year after Fama and French’s 1992 and 1993 papers. Given the time it takes to research a paper and get it published, it must have been in the pipeline before the F&F papers came out, rather than simply being a reaction to them. LSV’s paper was an impressively comprehensive treatment of the subject of value versus glamour stocks. They looked at several ...

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, interactive tutorials, and more.

Start Free Trial

No credit card required