Global Value Investing
A multifaceted approach to value investing with stock valuation based on intrinsic value estimated from cash returns, appraised value of assets, and other facets of value.
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A Message from the Author: The material at this site has been the most useful for my investing. Content is added on occasion. Active close reading helps. The emphasis is on sound reasoning.
This web site is created to share information about value investing with stock valuation. No other web site is known to cover in depth this important area of economics, finance and investing. Investment value is absolute economic intrinsic value estimated from discounted expected dividends or free cash flow to equity. Intrinsic value can be used with other aspects of value to estimate investment value and find investment opportunities for the long-term investor.
My vocation is economic researcher, independent of institutional affiliations. My investments are guided by scholarly scientific research in economics and related disciplines, i.e., the valid study of interesting and important questions motivated by the search for reliable results, whether or not they ultimately prove to be significant in hypothesis testing. In other words, the research goal is not exclusively publishable findings which therefore must be significant, whether or not valid. My formal education consists of engineering, business, and political economy. I have taught two upper-division university courses, one a finance course in investments and the other a business policy course in corporate strategy and industry structure. To send a message, see the contact information.
Scholarly research as the term is used here refers to original inquires that are motivated solely by the desire to solve a problem related to an interesting and important question and are performed at a high level of scholarship. Not all scholarly research is academic, and not all academic research is scholarly. Brokerage house research is neither scholarly nor academic. In addition, scientific research as the term is used here refers to studies that strictly adhere to rigorous established standards of theory, methodology and empirical analysis. Serious scholarly and scientific research eschews data snooping, political correctness and socially-determined research results.
My scholarly, scientific research in the field of financial economics includes a dissertation cited in the General Books. It is the basis for a book-length manuscript with working title Stock Market Pricing: Anomalies and Fallacies. The pricing of all capital assets in the aggregate in publicly-regulated markets is distinctly different from the valuation of individual operating enterprises considered one at a time. While the stock market pricing process is interesting and important in its own right, it has no necessary relation to the independent valuation of companies and their common stocks considered ad seriatim. Whereas the Global Value Investing web site is concerned with the independent valuation process and written primarily for individual investors, the proposed book is concerned with the market pricing process and written primarily for serious scholars and professional investment managers.
The book is an inquiry into the nature and causes of the stock market pricing process and its contribution to the wealth of nations. The purposes of the book are (1) to study the competitive free market pricing of the common stocks of private companies, (2) to make new contributions to the theory of investment and thereby reconcile the pronouncements of academics, journalists and practitioners about significant pricing anomalies and associated investment strategies, (3) to consider both the public-sector and the private-sector policy implications of the study findings, and (4) to demonstrate a new standard of scientific empirical research in financial economics that meets strict scholarly requirements.
To share the research findings with relevant audiences, I am searching for the right publisher for this scholarly book about capital market pricing and world competitiveness. One reviewer called it "two major surprises." One major surprise is the exposure of the so-called size effect as a fallacy and the associated small-cap investment strategy as a financial fad. The second major surprise is the discovery of the R&D effect as a scientifically-valid significant persistent pricing anomaly. Early responses from major publishing houses and presses have been encouraging, with comments that the work is "interesting and important", "impressive and timely", "provocative" and "strong." The right publisher will seek scholarly works with a business orientation for a limited market. There is no intention to write a popular "get rich quick with a new secret trading system" version of this book for the general trade market.
I am also considering appropriate academic peer-reviewed journals to publish theoretical as well as empirical papers extracted from this manuscript. The tentative titles for the theoretical papers are "Critique of Asset Pricing Circularity" which includes arguments involving theoretical, methodological, empirical and clinical issues, "A Typology of Asset Pricing Models", "A History of the Size Effect", "Stock Pricing versus Company Valuation," and for the empirical papers are "The R&D Effect with Static Stock Pricing", "The R&D Effect with Dynamic Stock Pricing" and "The Proprietary-R&D Effect."
The circularity paper has a crucial influence on the hypothesis-testing strategy of the two papers about the newly-found R&D effect. While the circularity paper can stand alone, reading it before the R&D papers or any other paper about capital asset pricing may clarify the latter. The three papers are organized as a set. The typology and history papers reinforce the circularity argument.
You can read the abstracts of three of these papers that are in the process of being submitted to academic journals for print publication. For a copy of these abstracts, go to the download page. These abstracts as well as those of other financial economics papers can be seen at the Social Science Research Network -- Financial Economics Network by using their search navigation buttons: either (1) Search & Download Papers, by Abstract (titles) or by Author (Robert Coleman); or (2) Search SSRN Web, using key words (asset pricing or R&D).
The major findings and the main arguments of this research are summarized in the book review of The New Finance and to a lesser degree in the book review of The Motley Fool Investment Guide. These book reviews are located at the What's New page.
Global Value Investing was created using Microsoft FrontPage with Image Composer. All errors are the responsibility of the author. The views expressed in Global Value Investing are those of the author and do not necessarily reflect the opinions of anyone else.
Requests for printed material about intrinsic value investing cannot be honored at this time because there is none. We have no four-color happy-talk brochure. Several visitors have requested a copy of the book manuscript or asked to be notified when the published book is available. Others visitors have inquired about the price of the book. Discussions with publishers may not lead to a book contract, in which event the manuscript may be self-published at this web site notwithstanding its equations and three-dimensional graphs. The author is an independent investor with limited spare time and is willing to make his research findings available at no charge to interested persons.
The bad news is that we have not yet electronically published this web site for downloading because the content is still a work in progress. In addition, the style could benefit from copy editing. Nevertheless, some visitors report having read every page at Global Value Investing at least once and some of the pages several times. Other visitors report having spent hours reading these pages on-line.
The good news is that it is possible to download these pages and read them off-line at your leisure. Several software products are commercially available that let you download entire web sites for viewing on your machine. For example, so-called "web capture" or "web grabber" software can be used to copy web pages, partial web pages and whole web sites. One such commercial program is CatchTheWeb. Web capture freeware programs are also available.
On March 18, 1999, Microsoft Corporation released its improved Internet Explorer Web Browser version 5.0. The MSIE 5.0 reportedly has a new feature that can save complete web sites to your hard disk, with graphics and all, so you can view them offline. Netscape reportedly has plans to beat MSIE 5.0 by the summer of 1999 with its new browser.
After the content at Global Value Investing has been completed and edited, we may electronically publish the web site in Adobe Acrobat Portable Document Format (files with PDF extension in their names). At that time, Adobe Acrobat Overview and Adobe Acrobat Free Reader may be of use. Adobe Acrobat is commercial software, and Adobe Reader is freeware. Acrobat PDF files are independent of platforms, applications, and distribution media. Adobe also has a service to Create Adobe PDF Online.
To translate the pages at this website from English to your language, go local.
This project has benefited from the questions, comments, suggestions, and interest of many persons too numerous to mention by name. In addition the web site continues to improve as a result of the contributions of others who wish to see its contents made more accessible to all interested investors, security analysts, investment managers, educators, and students.
Our benefactors include the brilliant legendary investors, past and present, who have so generously shared their knowledge about the theory and practice of intrinsic value investing so that we could be more rational and better informed in protecting our wealth and well-being. Their insights continue to guide those who have ears to hear and eyes to see, and their works are cited in the Books & Links sections for Special Books and for General Books.
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