Mill Street Research MAER Stock Ranking Model: Do You See What IC?

A few months ago, I wrote a blog post giving a brief history of the development of Mill Street’s MAER stock selection model and comparing the in-sample and out-of-sample test results now that it has been just over 10 years since the current model was originally launched.

The key metric I showed was the Information Coefficient (IC), which is the correlation between the decile ranks of the stocks and the decile rank of their subsequent 1-month returns (it can be done on other return horizons as well). 

That’s a BIG Apple

There have been a number of headlines recently highlighting the extraordinary market capitalization being awarded to Apple Inc. (AAPL), which has retaken the title as the world’s most valuable publicly-traded company.

The company’s value is now approaching $3 trillion, a level that places it not only as the largest individual company ever on public markets, but would rank it among the largest stock markets.