Not All Value Metrics Are Equal

The metric most commonly used to categorize value stocks and to construct portfolios is the one employed by the Fama-French three-factor model—book-to-market (BtM) ratio. Russell Indexes only uses BtM to determine value as well.

However, other metrics also show a value premium.

Today we’ll take a look at the historical evidence on the premiums provided by four additional value metrics: dividend-to-price (D/P); book-to-price (B/P); cash flow-to-price (CF/P); and earnings-to-price (E/P).

Read the rest of the article on ETF.com.

Privacy Policy | Legal Notices | Sitemap