This is a summary of links featured on Quantocracy on Thursday, 05/09/2019. To see our most recent links, visit the Quant Mashup. Read on readers!
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The True Cost of Hedging S&P Downside [Movement Capital]Hedging sounds like a smart thing to do. But has it actually worked? This post examines the historical costs and benefits of hedging stock exposure with SPY puts. Interest in hedging strategies tends to increase as market volatility rises. There are many ways to hedge, and a common method is to overlay SPY puts to protect existing stock exposure. Being long a put option offers limited downside and
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Buying Stocks Trading Above 10x Sales-A Good Idea? [Alpha Architect]Early last week, Meb Faber included me on a conversation on buying stocks trading at 10x their companys revenue (sales). Is this a good idea and how did it do in the past? Given that most known factors have underperformed over the past 10 years, I was interested in seeing if a somewhat crazy strategy(1)buying stocks trading above 10x salesworked over the past 10 years. Of