Summary
What Works on Wall Street by James O’Shaughnessy analyzes decades of market data to identify winning investment strategies. It finds that quantitative, rule-based approaches focusing on value and momentum factors that consistently outperform the market. The book advocates disciplined, long-term investing using historical evidence over emotional or speculative decision-making.
Ratings
Quote
The long-term data prove you need a minimum of 25 years to judge a strategy’s effectiveness.
Learnings
- Value outperforms growth: Companies with cheap fundamentals often beats flashy high-growth names in the long run.
- Rules beat humans: Rules-based models—not gut feelings or intuition—produces superior results over time.
- Momentum works: Momentum is a persistent and robust market anomaly across sectors and time periods.
Review
What Works on Wall Street is a game-changer. O’Shaughnessy masterfully blends data and strategy, offering timeless, evidence-based investing wisdom. I found its quantitative approach refreshingly clear and actionable. This book reshaped how I view markets—it’s an essential read for serious investors seeking long-term, proven methods to build wealth.
Audience
- Experienced investors: The book is not for beginners— it requires a working knowledge of finance and valuation.
- Strategic investors: The book is ideal for those who prefer data-driven, backtested approaches.
- Academic readers: Written in meticulous, research-heavy style—it appeals to readers studying finance academically.