Marrying the Art and Science of Successful Value Investing with Astute Investor’s Calculus

Art of picking great value stocks

Hello Everyone,

As a Max Dividends reader, you know that investing is a process that requires doing a few things consistently over a long time. Dividend Growth Investing is one path to success. There are other paths as well.

Let me introduce you to Shailesh Kumar, the author of Astute Investor’s Calculus. He has a knack for finding unknown and underfollowed small-cap value stocks (US exchanges), that lead to high returns with uncommon regularity.

Shailesh ran a very successful newsletter on value investing for over 10 years, before starting Astute Investor’s Calculus. While proficient in the art of picking great value stocks, he felt that there was something missing. Something that goes to the very core of building a resilient, high growth portfolio.

Astute Investor’s Calculus is his “I’ve figured it out” investment process.

Here are the 3 steps to his process:

1. Screen 1000s of stocks to find the few 100s to deep dive in. From these, pick a few every month that are worthy of your investment dollars

2. Review each of the shortlisted stocks against the current portfolio to see if they fit. They need to add potential return, but they also need to decrease the portfolio volatility, instead of increasing it. You can think of this as diversification. But he goes further – he calculates the optimal position size of each stock in the portfolio based on Kelly Criterion that is mathematically proven to maximize the long term portfolio growth, and,

3. Constantly rebalance to harvest volatility, reduce cost basis and generate additional alpha through a process called Shannon’s Demon

The result is a robust investment process that picks the right value stocks, allocates capital to build an optimal portfolio, and then juices it up even further by tactics to reduce cost basis and turn volatility into profit.

In the next email I will share one of the recent stock picks Shailesh shared with his paid subscribers (you’ll be able to read it for free). You will not want to miss it.

Best regards,
Max