FYI Hussman’s funds have missed out on much of the strong equity gains in recent years, prompting some criticism of his investing style. The Hussman Strategic Growth Fund HSGFX is down 1.5% this year, compared to 7.2% gains on the S&P 500 index SPX , according to Morningstar. The other funds have fared a bit better: The Hussman Strategic Total Return Fund HSTRX is up 6.8%. The Hussman Strategic Growth Fund HSIEX is up 1.9%, while the Hussman Strategic Dividend Value HSDVX is up 0.2%.
Regards,
Ted
http://blogs.marketwatch.com/thetell/2014/07/27/this-stock-bubble-is-beyond-1929-and-2007-says-john-hussman/tab/print/
Comments
Regards,
Ted
Actually, he did amazingly well from inception on 7/24/2000 thru the end of 2008.
His 2001 and 2002 performances were exceptional. Most funds were taken to the cleaners in 2002. The Vanguard S&P 500 index fund lost 22% in 2002, and lost 12% in 2001. For Hussman to have been up more than 14% in each of those years is really something.
From inception thru the end of 2002, unbelievable performance.
2003-2007, lukewarm.
2008: Exceptional, considering the S&P 500 went down 37%
From 2009 till the present: unbelievably bad performance.
What's so unique about Hussman is his academic credentials. It's one thing to hear a charlatan say the Dow is going to 6,000 and the sky is falling. It's a bit different when someone with a PhD in economics from Stanford, who had an exemplary mutual fund record for almost 9 years, writes the kind of stuff Hussman writes.
But I hate to think of what scott mentioned.
I mean really, what ammunition does the Fed have left? They already have 4 billion dollars on the balance sheet, and Greenspan just said it will be one of the major problems addressing how to wind that down.
http://www.marketwatch.com/story/greenspan-worries-about-false-dawns-fed-exit-2014-07-24
If the economic recovery fails (or a "bubble" bursts), would they do, add another 4 billion to the balance sheet thru more massive QE?
The Federal Funds rate is zero to 0.25%
What do they have left in their bag of tricks, a negative Federal Funds rate?
I think somewhere in Europe already has that now.
The only ding is how he lost 12 percent in 2012. Thats a head scratcher. He is a hedger not a shorter. M* can go **** itself. However, he did screw up there. Also calling him a perma bear is also wrong. But hey, what do i know. As long as he is not madoff, i am fine holding his funds. I am equally invested from cost basis standpoint in hsgfx and hstrx, and i sleep just fine.
I really dislike Hussman's positioning (this whole overly complex and unnecessary completely hedged long portfolio.) If he feels the way he does, go heavily to cash and staples, with some light hedging if need be. Simpler strategy (given his views) and would have likely done better. I think there is a stubbornness in keeping with the portfolio positioning.
Additionally, calling the stock market a bubble and being long thing like Panera, Starbucks and Viacom? Meh.
"He is a hedger not a shorter"
The portfolio - last I looked - remains fully hedged. So, either his hedging strategy is not working or his long portfolio is underperforming or some combination of both, although I'm thinking it's the former more than the latter. I think we've gone over this before and I forget what the result was, but I'd be curious what Hussman's unhedged performance would have looked like over the last 2-3 years.
If you think the market is overvalued, hold cash and high quality short term corporates, maybe through an etf like VCSH. No need to get fancy.
" Hussman is clearly smart and hardworking and cares about his shareholders."
I think he's intelligent and certainly provides a lot of research behind his opinions (and yes, his theories vs reality haven't exactly worked out), but I think in terms of managing money, if a year goes by and your views are not playing out, you figure out a way to adjust somehow. There is a point where, as a money manager, you have to adapt. That's not to say that Hussman should have turned around and gone 2x long - it's just even asking, "Is there a way I can express these views in my investment approach differently that could be more effective? Is the options strategy working?"
If a manager can't appear to question his approach and seek ways to possibly improve it, then...I don't have use for the fund, really.
You have this right. I would refine your opinion by saying its his performance from 2010 on that was bad. Given his approach, it was his execution of the hedging, not the timing of it, that led to his unacceptable negative returns.