Use Haugen’s methodology: Rank the S&P 500 by standard deviation of daily returns over 24 months. Discard the top 50% (highest volatility). From the bottom 50%, screen for positive free cash flow yield.
Haugen was an early critic of blind asset allocation. He argued that the correlation between stocks and bonds changes violently during inflation. His text provides the tools to build a "variance-resilient" portfolio, a topic dominating Reddit’s r/investing today.
Use Haugen’s methodology: Rank the S&P 500 by standard deviation of daily returns over 24 months. Discard the top 50% (highest volatility). From the bottom 50%, screen for positive free cash flow yield.
Haugen was an early critic of blind asset allocation. He argued that the correlation between stocks and bonds changes violently during inflation. His text provides the tools to build a "variance-resilient" portfolio, a topic dominating Reddit’s r/investing today. modern investment theory robert haugen pdf
