EQUITY INVESTING
Investing can take many forms, but it starts with an investor assigning a value to a security. Whether this value exceeds or is less than the current market price usually determines whether the investor will buy or sell the security. In the case of equities, the investor often seeks to understand the specific company under consideration, the broader economic environment, and the interplay between the two. This encompasses a wide range of information for the investor to consider as displayed in Exhibit 1.1. How this information is used differentiates the quantitative from the fundamental investor.
EXHIBIT 1.1 The Value of a Stock Comes from Multiple Information Sources
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