The Intellectual
Investor’s
Lexicon
By Vitaliy Katsenelson
R
Range-Bound Market
During range-bound periods, P/E compression acts like gravity pulling stocks downward, while earnings growth provides counteracting force. The benefits from earnings growth become gradually offset by ongoing P/E compression. Stocks move sideways for extended periods during this process.
Return on Capital
High Return on Capital (and economic value added returns) far exceeding the cost of capital, another scorecard for value creation.
Reverse Marketing
We do what I call ‘reverse marketing.’ I write articles, people read them, and in these articles sometimes I talk about what we do. When people get interested in our services, they download our brochure and reach out to us.
Risk (as Permanent Loss of Capital)
Volatility is not risk. Risk to us is permanent loss of capital.
