Active Value Investing
Making Money in Range-Bound Markets
Wiley Finance Editions
1. Edition October 2007
304 Pages, Hardcover
General Reading
Praise for Active Value Investing
"This book reads like a conversation with Vitaliy: deep, insightful, inquisitive, and civilized."
--Nassim Nicholas Taleb, author of The Black Swan
"Vitaliy Katsenelson walks you through his thought processes in constructing an active value portfolio. There is not enough discussion in value investing circles about when to sell stocks, and this book advances that subject. A good balance between theoretical discussion, real anecdotes, and commonsense observations."
--David Einhorn
"Active Value Investing clearly highlights that the stock market is not a smooth trend; rather, it has periods of surge and stall. Katsenelson explains range-bound markets and emphasizes that 'valuation matters'--the valuation paid for stocks impacts the ultimate return. Range-bound markets especially require an unconstrained process of analysis to identify undervalued securities, and Katsenelson delivers a much-needed framework to achieve superior returns."
--Ed Easterling, President, Crestmont Research, author of Unexpected Returns: Understanding Secular Stock Market Cycles
"A delightfully documented and detailed deconstruction of buy-and-hold dogma. A must-read for any open-minded, thinking investor--professional or individual."
--Donald Cassidy, President, Retirement Investing Institute, and author of It's When You Sell That Counts
"Active Value Investing offers a rare combination of focus on value of underlying companies with appreciation for the effect of market dynamics on portfolio performance. Investors who understand both have the flexibility to succeed in a variety of markets. Katsenelson has the gift of packaging expert financial insight in an entertaining and educational package."
--Aaron Brown, Executive Director in Risk Methodology at Morgan Stanley author of The Poker Face of Wall Street
"Vitaliy has crafted a valuable assimilation of the primary market metrics that will benefit the active trader and long-term investor alike."
--Todd Harrison, founder and CEO, Minyanville Publishing & Multimedia, LLC
"Active Value Investing has the hallmarks of all great investing books--easy to read, humorous at times, and, most of all, it demonstrates Vitaliy's investing process in terms accessible to the novice and expert alike. Despite its title, this is a book for bull, bear, or range-bound markets and will be highly recommended to our newsletter subscribers."
--Philip Durell, advisor, The Motley Fool Inside Value
Introduction.
Acknowledgments.
Part I. What the Future Holds.
Chapter 1. Introduction: Range-Bound Markets Happen.
Chapter 2. Emotions of Secular Bull, Bear and Range-Bound Markets.
Chapter 3. Stock Market Math.
Chapter 4. Bonds: A Viable Alternative?
Part II. Active Value Investing.
Analytics.
Introduction to Analytics: Quality, Valuation, Growth.
Chapter 5. The "Q" - Quality.
Chapter 6. The "G" - Growth.
Chapter 7. The "V" - Valuation.
Chapter 8. Let's Put It All Together.
Strategy.
Introduction to Strategy: The Value of Process and Discipline.
Chapter 9. Buy Process - Fine Tuning.
Chapter 10. Buy Process - Contrarian Investing.
Chapter 11. Buy Process - International Investing.
Chapter 12. Sell Process - Darwin Would Be Proud.
Risk and Diversification.
Introduction to Risk and Diversification.
Chapter 13. A Different View of Risk.
Chapter 14. A Different View of Diversification.
Chapter 15. Conclusion and Implication.
Appendix A. Years to Bull Market.
Endnotes.
This book should be considered a practical compendium of modern finance, leaving no stones unturned on your way to better investments. Katsenelson's passionate, witty and accessible writing expertly takes the reader through his original framework for valuing stocks in range-bound markets. A student of history and an overzealous stock picker, the author entertainingly illustrates every concept with a collection of real-world examples, demonstrating an impressive breadth and depth of understanding of what makes stocks move!--J.P. Tremblay, CFA
"How to adapt value investing for "range-bound" markets." (Financial Times, Tues 26th February 2008)
"The new Benjamin Graham is Vitaliy N. Katsenelson. I highly recommend Katsenelson's book, Active Value Investing: Making Money in Range-Bound Markets (Wiley, 2007). I like to think the old Ben Graham would have recommended it, too."--Forbes
