[DesertCat]

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I am an economics student with specialization in finance theory. I pretty much much know modern portfolio theory, how to calculate a boatload of diffrent ratios from statements and a lot of nice formulas. The area i am lackin in is however how to apply thoose things in deciding if an investment is a good bet or not.

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There is a large philosphical gulf between modern finance theories and Ben Graham/Warren Buffett "Value" investing.

Basically, most value investors regard large portions of academic financial teachings as useless rubbish. Specifically the ideas that the market is always efficient, or that a stock's beta measures it's risk level.

In fact, some value investors argue the higher the beta, the less risk there is in a stock, because you have more opportunities to enter and exit your positions when it is advantagous to you. This is Warren and Ben's old analogy about "Mr. Market" and how he is your friend.

You probably don't to hear that that some people regard that expensive education you worked so hard for as worthless (but you don't have to agree with them either!). To further your education and get a better idea of where the value investor criticism comes from, you might also want to read Warren Buffett's collected Berkshire Hathaway shareholder letters. They are a pleasant read, and in a breezy manner lay out much of his investing philosophy as well as his objections to modern portfolio theory. Like I said, you don't have to agree with them, but you should at least understand their position if you want to be a skilled investor.

The letters are available for free at BerkshireHathaway.com. Best of luck to you on all your investing endeavors.