Q.i. Value

Q.i. Value is a ranking value that uses a combination of the best valuation ratios we have tested including the work from the research paper Quantitative Value Investing in Europe: What Works for Achieving Alpha.

It ranks the whole universe of companies in the screener using four valuation ratios and thus helps you to select the most undervalued companies.

Q.i. Value is calculated with the following ratios indicators:

  • EBITDA Yield
  • Earnings Yield
  • FCF Yield
  • Liquidity (Q.i.)

The lower the Qi Value number the more undervalued the company is.

 The Qi Value ranking ranges from 1 to 100 and this is how it is calculated:

  • We first rank all the companies in the database by each of the ratios from good to bad - from 1 to 22,000.
  • We then add the four rankings of each company together and rank the whole universe by this combined ranking.
  • Once all the companies are ranked we divide then into groups that make up 1% of the total universe - for example the best 1% of companies by the combined ranking get a Qi Value ranking of 1, the next 1% a ranking of 2, until 100.
  • We do this to give all companies a Qi Value ranking from 1 to 100.  1 = the best ranking and 100 the worse.

 

You can find more information here:

Liquidity (Q.i.) indicator identifies neglected (mis-priced) companies

This overlooked ratio, large funds and hedge funds can’t use, gives you higher returns