Portfolio optimization at long-term investment with value investing method

Most of the developed countries have healthy and deep-enough capital markets. Realizing the future investments of the companies easily and less expensive and citizens prospering by becoming a sharer of the profits of companies with their personal little savings are provided through the stocks which are offered to the public at capital markets. The corporations which are eligible for a long-term investment needs to be selected at this point. "Value investing" method is proposed and studied for the mentioned selection within this work. The motivation for proposing the value investing method when investing for the long-term is explained by giving examples from Turkish economy. Furthermore, the criteria of the value investing are identified, grouped and described. On the other hand, the risks of value investing are also defined and the counter-measures for eliminating these risks are proposed. Finally, the performance of two portfolios which both consists of five publicly-traded companies selected from Turkish and American stock markets is analyzed for the last 5 year by considering the consumer price indices for testing the value investing method.