GeoInvesting cofounder Maj Soueidan and DIY quant investor Ryan Telford discuss quantitative investing strategies, insights into microcap and nanocap stocks, and delve deeper into other approaches to microcap investing. Ryan Telford kicks off the conversation by sharing some influential books that have shaped his investing journey. Among them are "The Little Book That Beats The Market" by Joel Greenblatt, "Thinking Fast and Slow" by Daniel Kahneman, and "What Works On Wall Street" by James O’Shaughnessy. Moving on, Ryan delves into a couple of articles he wrote on Seeking Alpha. One of them focuses on timing the market using two quantitative methods, while the other explores the concept of finding super stocks through the super strategy.
Ryan Telford then shifts the focus to his Quantitative Investing Strategies, which he employs in inefficient markets to achieve remarkable returns. He discusses his investment approach, which encompasses factors like growth, valuation, balance sheets, market dominance, and cash flow. Ryan emphasizes the use of backtesting, analyst estimates, and a typical holding period of three to twelve months. He reveals that his approach is purely quantitative, and he doesn't engage in reading individual 10-Ks or 10-Qs, nor does he conduct management interviews. Throughout the conversation, Maj and Telford explore various investing perspectives, including contrarian investing, with a brief mention of shorting stocks. Ryan emphasizes that he looks at the overall strategy rather than individual stocks, comprising a portfolio of 25 to 30 stocks. He takes a disciplined approach, avoiding emotional attachment to stocks and selling based on predefined rules or signals generated by their strategy.
The discussion continues to revolve around quant strategies, factor investing, and the numerous advantages of focusing on micro-cap stocks. Maj and Ryan delve deeper into the design and implementation of quant strategies, including ranking systems, screens, and buy/sell rules. They also emphasize the significance of industry analysis and the potential for finding opportunities in industries experiencing cycles of growth and consolidation.
