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Latest Write-ups, Our ALA Excursion and Apple

publication date: Jan 30, 2020
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author/source: Brian Nelson, CFA
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Latest Write-ups, Our ALA Excursion and Apple 
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Find links to our latest research in this note. Value Trap continues to gain traction in the public domain. We'll talk Apple and let you know what we're watching after the close January 29.
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Hi everyone,
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We're back from a three-day retreat at the American Library Association (ALA) Midwinter conference, and I must say I was mighty impressed with the response we received from sharing Value Trap. We handed out copies to librarians around the country, from professional to academic to public and beyond. I fully expect that Value Trap will be in most databases around the country, and I think it makes for nice exposure for advisors and industry participants that submitted a book blurb. Thank you for that. We'll likely be writing and releasing a second edition eventually.
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Why was Value Trap so important for our firm to release, and why was the timing better than ever? Quite simply, investors are being swindled, in my opinion. I've been in this business a long time, studied at the University of Chicago Booth School of Business, labored hours to earn the Chartered Financial Analyst designation, trained dozens if not hundreds of analysts, and built and updated 20,000 discounted cash flow models during the past 10 years. To put it bluntly, I know a little something about finance and the markets. 
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What I see the quants doing is flat-out scary, and I had to tell you. In fact, I did tell you in Value Trap, and in no uncertain terms. I also sounded the alarm bells on quant with the video series, "Off the Cuff" which we released in late 2017 and early 2018. Since then, 85% of US quant mutual funds underperformed the S&P 500 in 2019, and some 80% of them underperformed the market during 2018. It's a nightmare out there. Some have named it a "quant winter," and while most of the market is going nuts over machine learning and artificial intelligence (variants of quant research), you were warned in advance of the fall out! 
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Let me tell you straight: Most all of today's quantitative finance is nonsense. I'm not kidding. Watch my presentation to the Los Angeles chapter of the AAII here. We're now up to 30 ratings and reviews of Value Trap on Amazon, and I appreciate it so much. We're 75% of the way to our goal of 40, so let's get to it. Just 10 more is all we need. Review Value Trap here. Value Trap is in part a reformation on quantitative finance and acts as a central hub on the key areas of behavioral finance, quantitative theory and stock valuation. We talk about the Valuentum process in the last chapter, Chapter 10.
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Let's now talk Apple (AAPL). Of course, we're not basing our decisions on any one quarter. Apple had been a holding in the Best Ideas Newsletter portfolio since inception in 2011, and it was added to the Dividend Growth Newsletter portfolio a couple years after that. The stock was held in these newsletter portfolios through this month, January 2020, when we removed it. We still think shares are overpriced, per our valuation report here, and in case you missed our newsletter notification alert regarding Apple, it can be found at the following link, "ALERTS: Big Changes to the Portfolios; Goodbye Apple."
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Our team has been busy. In case you missed some of our latest work, the links are provided below: 
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Starbucks Reports Earnings, Coronavirus to Hurt China Sales
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The Great Guyanese Oil Boom
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Why We Like Lockheed Martin as a Defensive Dividend Growth Play
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Johnson & Johnson Closes Out Fiscal 2019 With a Strong Fourth Quarter Report and Promising Fiscal 2020 Guidance
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Intel Roars Higher
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Why *NOW* Do You Care About Boeing's Stock?
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Why Natural Gas Prices are So Low and Will Likely Remain So for Some Time
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That's all for now. We'll be looking for earnings at Facebook (FB) and Microsoft (MSFT) after today's close. We're available for any questions.
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Thank you!
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Brian Nelson, CFA
President, Investment Research
Valuentum Securities, Inc.
brian@valuentum.com

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