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HOW IT WORKS

Behavior drives prices
We measure the risk that creates

The h-factor TM is a 0–100% risk score showing the probability that a company will fail to deliver the growth already built into its stock price.

A higher score means greater risk because investor behavior has driven the price beyond what our analysis shows the company can deliver.

This isn’t traditional risk. It’s not about market volatility or operational missteps. It’s about the beliefs and biases that inflate prices – and the hidden risk that creates.

The h-factor is how we measure that risk.

The behavioral risk no one talks
about

Markets often price in stories – not evidence.

And when belief gets mistaken for fact, prices disconnect from reality. That’s where the real risk lies: not in the company, but in the crowd.

Most strategies don’t see it. They chase winners. Or hold the whole index.

But neither approach is able to avoid the losers – the companies most likely to disappoint. 

That’s what the h-factor does. It helps you identify the names that carry the greatest risk of disappointment before that risk becomes a result.

How we avoid the losers

We use the h-factor: an innovative, rules-based, process that measures the risk of failure.

STEP 01

Calculate the revenue growth rate the company MUST deliver indicated by its stock price.

STEP 02

Calculate the revenue growth rate the company COULD deliver based upon the past 12 quarters.

STEP 03

Calculate the h-factor, the probability the company will FAIL to deliver the growth.

Information as of
July 31, 2025

Index / Sector / Industry group / Industry / Sub industry

Current Stock Price:

$

$

Indicated Growth Rate:

-4.50%

Mean Historical Growth Rate:

2.72%

The h-factor:

The h-factor is a risk score from 0%-100%. It tells you the probability that a company will fail to deliver the revenue growth indicated by its stock price.

Find out more about the h-factor

Why it matters

This isn’t about betting on brilliance. It’s about removing the companies most likely to fall short.

Back-tested across two decades:

Low h-factor stocks consistently outperform high h-factor stocks
With less volatility and better risk-adjusted returns

Ready to rethink your portfolio?

Let’s start with the risk you can control.

Request access today to get 120+ strategies inside SPACE.

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