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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 revenue growth indicated by its stock price.

You can diversify company risk away, you can hedge market risk, but you can only avoid human risk. At New Age Alpha, this is exactly the kind of risk the h-factor was built to measure and avoid – the behavioral distortion from storytelling that inflates stock prices beyond what companies can realistically 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.

Investors don’t see it
and they don’t get rewarded for taking it

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.

Active managers chase stories. Passive investors own everything.

But neither approach avoids the losers - the companies most likely to fail to deliver the revenue growth indicated by their stock price.  

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

How we aim to avoid the losers

We use the h-factor: an innovative, rules-based process that measures the probability a company
will fail to deliver the growth implied by its stock price.

STEP 01

Calculate the revenue growth rate the company must deliver.

STEP 02

Calculate the revenue growth the company could deliver.

STEP 03

Calculate the probability the company will fail to deliver that 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 luck disguised as skill. It’s about using math to avoid the losers.

With over two decades of experience
we have demonstrated that low h-factor stocks consistently
outperforms high h-factor stocks.

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Where advisors learn to identify
and avoid the losers.

© 2025 New Age Alpha LLC. All Rights Reserved.   CC: NAA10183N | SKU: 10234