He wrote the book used by most university students.

+Uriel Martinez Is there any evidence that its methods will have higher expected returns after transaction costs and risk than a low-cost index fund? I'm skeptical. If a finance book really came up with something groundbreaking that seemed to give its disciples an edge over everyone else, then everyone would switch to that method and drive average profits down to index levels again.

+Fishbone Mash Good question. A good way to look at the book is as a broadening in the discussion as to whether equity markets are efficient in the sense that price is indicative to value. Like most value investors they tend not to think so. Dr. Penman simply provides a different angle in the pursuit of higher profits and the aforementioned conclusion. Dr. Penman avoids valuations such as DCF and pursues more of an accounting approach in search of the elusive intrinsic value. But does it bring higher returns than a low-cost index fund? I really couldn't tell you as I just started implementing Dr. Penmans approaches unto my portfolio.

It's called Security Analysis and the Intelligent Investor.

Uriel Martinez Has the theory proven to improve your portfolio so far?

Uriel did u really finish reading the book?