The Sophisticated and the Simple: The Profitability of Contrarian Strategies from a Portfolio Manager's Perspective

Valuation signals have been among the most popular with equity portfolio managers and have recently attracted significant interest from cross-asset managers. Given a large variation of techniques and theories with regard to how value is measured, this paper investigates the efficacy of alternative value measures. It considers a cross-section of simple and sophisticated alternative measures and focuses on comparison metrics that are of primary interest for equity portfolio managers. A revisited version of this paper was published in the January 2014 issue of European Financial Management.