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Ryan Patrick Kirlin 👽 Profile picture
Ryan Patrick Kirlin 👽
@RyanPKirlin
Follow as I learn more and share with you about investing. Alpha Architect. Deep Value, high momentum, and trend following ETFs.
Aug 22 • 6 tweets • 1 min read
Why did Berkshire sell a bunch of AAPL stock? I can't do anything but speculate, but here's one likely reason.

AAPL's EV/Sales (LTM)

Current: 8.8
4Q 2022: 5.7
3Q 2016: 1.7

That's a 54% multiple expansion from 2022 to today. and a 417% expansion from 2016 to today. Investors are paying 54% more for the same dollar of sales from ~2 yrs ago.

They're paying 417% more for the same dollar of sales from 8 yrs ago.

Would you sell your own business for 8.8 ev/sales? Most would sell in a hurry, no questions asked. hah!
Jul 31 • 7 tweets • 3 min read
When building investment portfolios, three things matter:

1) Returns
2) Correlations
3) Max drawdowns

Forget about one and you could be in trouble. Build portfolios that take all three into account based on your personal goals and you'll do well. Lets start with the simplest portfolio we can. The aggregate bond index ETF (AGG) and the SP500 (VOO).

0.29 correlated to each other back to the inception of AGG. Pretty good. They are generally doing different things.

This is why it's reasonable to put them together and move on.Image
Jun 6, 2023 • 11 tweets • 3 min read
It's that time of the quarter, when we talk about what stocks have high momentum *and* low volatility (frog in the pan) and has passed our momentum screens for US stocks.

But you know what stock doesn't have that combo?

NVIDIA $NVDA. It didn't make the cut. NVDA is the largest holding in $MTUM at 6.11%

Followed by Meta at 5.39% and Microsoft at 5.15%.

None of them made it through our screens, so not all momentum is the same.

Which is the best way? Nothing but time will tell.

ishares.com/us/products/25… Image
May 16, 2023 • 9 tweets • 3 min read
Have you heard? The spread between the cheapest 10% of stocks by EBIT/TEV and the market is wide?

Of course you have. We've been talking about it for two years. You're tired of hearing it, we're tired of talking about it, and that's how it will be until things change.😇

But... Image To give more feel for where we are at let's take a look at the *most* expensive stocks by EBIT/TEV and the cheapest.
Jan 26, 2023 • 4 tweets • 1 min read
A hidden cost for buy and hold investors of mutual funds:

"the costs of providing liquidity to transacting shareholders are borne by the non-transacting investors who remain in the fund, which dilutes the value of their shares." This is from a Fed research study: federalreserve.gov/econres/notes/…
Jan 25, 2023 • 5 tweets • 2 min read
Did you know Bond Mutual Funds face more of a liquidity risk than Bond ETFs in a crisis?

The common understanding is the opposite. This isn't just from me...it's from the Fed!
Oct 27, 2022 • 4 tweets • 1 min read
We did a presentation recently for advisors on how one advisor is using our portfolio architect tool for prospecting and marketing.

Here was a prospect's portfolio compared to the Russell 1000.

E/P of Prospect portfolio = 4.80
E/P of Russell 1000 = 4.90 Image It's the same thing. Getting younger prospects to see that maybe all isn't what it seems is one benefit of looking at characteristics.
Oct 27, 2022 • 12 tweets • 2 min read
Do momentum investment strategies survive trading costs? Yes! The debate is there are some characters in the financial world that are adamant a momentum strategy cannot survive trading costs.

Which is really interesting in what they are not saying.
Oct 26, 2022 • 4 tweets • 1 min read
$META thread updated.

Down 18% after hours. And it was already in the top 10% cheapest before that. We have a negative momentum screen and quality screens that potentially will keep it out at the next rebalance, but at least it's in the convo now!
Jun 21, 2021 • 11 tweets • 2 min read
Good morning race fans!

Why do we target 50 stocks? And not 100? or 203? or 450?

Simple: We want to tilt into the factor we are targeting (value or momentum) as heavily as possible while removing risk specific to a single stock. The chart in the previous image shows that as you go from 1 stocks, to 10 stocks, to 30, to 50...you can see once you get around ~50 stocks, you pick up most of the benefit of only being left with "systematic risk."

That is, the risk when the whole market goes down.
Mar 9, 2021 • 6 tweets • 2 min read
Why timing factors generally doesn’t work:

1) When things change, they change fast. Late by a week? Well...

2) things can stay changed much much longer than you’d think. Early by a ten years? Well... Why for most advisors we recommend to keep something like this simple model:

1) 50% general market exposure.
2) 25% momentum
3) 25% value.

Rebalance.