Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.
Hi Guys,
I never anticipated that my regression-to-the-mean comment would promote such excited, inflammatory, and provocative reactions. I perceived my submittal to be rather innocuous. Apparently it was not received as such.
I was simply trying…
Hi Guys,
Change happens; it is a certainty.
"Richard Russell, the famous Dow Theorist, once noted that over a shorter time frame almost anything can happen in the financial markets, but over much longer, meaningful periods of time (referring to ye…
Hi Guys,
When investing in equities and/or bonds, often an optimistic outlook is needed to help an investor to stay the course. But that optimism should be grounded in realistic expectations. The target return numbers quoted from the Boston-based…
Hi Guys,
I participate on MFO for the very simple reason that by doing so I can leverage investment wisdom diversity. Perhaps wisdom is too strong a word, but there are a lot of smart investment folks who populate these exchanges. We all benefit …
Hi Guys,
This article by author Andrew Hallam has a very simple answer to the question offered in the title of that article: an easy qualified Yes even under stressful market reversals. It's qualified because it uses past market crashes to define …
Hi Guys,
Statistics and probability theory are not easily understood by the general population. These subjects can get very complex. I would suspect that the media would do better of these subjects, but that's just a guesstimate.
But they often …
Hi Maurice,
Thank you for your informative reply post. Player salaries have certainly escalated. The equity market might be currently overvalued, but not as much as the major league current pay standards. But, what do I know? Not much in that f…
Hi Maurice,
You're a hard man Maurice. Most everyone loves baseball and has some opinion on it, although not always positive. That mirrors investing in that aspect.
" ...... at the end of the day we can feel more than a little justified about Am…
Hi Guys,
I don't know much about baseball, but not knowing much about a topic has never dampened my desire to contribute if probabilities can be defined. And in baseball, statistics dominate and permit respectable probability estimates.
Among pro…
Hi Guys,
I don't fear Artificial Intelligence whatsoever, especially in the active mutual fund management business. Over a very, very long timeframe, AI might become a problem if its influence becomes overwhelming and without human interaction and…
Hi Guys,
Thank you all for your meaningful contributions. They all enhanced this exchange effectively and with considerable impact.
I was motivated to visit both additional referenced sites. I don't especially remember the Alamo or the Maine, bu…
Hi Guys,
"The future is uncertain, so investors should always think in terms of probabilities, never guarantees. What this data tells me is that the longer your time horizon, the higher your probability of seeing a gain in the stock market."
That'…
Hi Guys,
KISS (keep it simple, stupid) wins again! Simplicity has many advantages over complexity, especially in the investment world. Many of the 36 investment golden rules summarized in Ted's recent reference to a Ben Carlson article hint that …
Hi Guys,
In the investing world, it is a rock solid guarantee that introducing technical analysis into the discussion will promote a heated debate. The controversy will surely continue beyond our limited exchanges.
Some folks are entirely committ…
Hi Guys,
I know. Yes, I know I'm a broken record on a tool that is extremely useful when discussing long term planning and decision making. That's because I've been retired for almost two decades and have experienced many of its issues and proble…
Hi Guys,
Dr. Ed Yardeni and his staff always do an excellent and very comprehensive job when preparing their endless array of charts. These charts always inform and help in reducing uncertainties when making a financial decision.
I trust the cha…
Hi Guys,
While what device is used to complete a trade is the specific topic under discussion, that's a detail that doesn't inspire me too much. A far more meaningful discussion would center on how a decision to trade is made and what tools are us…
Hi Guys,
Most studies report that actively managed mutual funds seldom outperform a relevant benchmark over extended timeframes. For one year periods the odds are near 50/50, but over more meaningful timeframes, the odds of actively managed funds …
Hi Guys,
Once again, a nice and useful article from Ben Carlson. He notes that volatility is a killer that reduces compound return over time. Not many folks appreciate its wealth eroding impact. How bad is it?
A simple relationship equates comp…
Hi Guys,
There is no universal correct answer to the fund management question. It depends on the specifics. Most funds these days are team managed, like 75% of them. For this majority, the answer is in the No bracket. But a respectable number o…
Hi Guys,
This is a damn difficult question that has no single simple answer. I agree with Old Joe. It depends on the specific circumstances of each individual investor.
So, regardless of anyone else's answer, I'll default to a more modern US Arm…
Hi Guys,
Put together a group of market forecasters and the forecasting outputs will vary all over the map. Historically, GMO tends to be conservative and its projections are typically on the lower end of expected returns.
What action should be t…
Hi Ted,
You're absolutely on-target. Sorry I missed that obvious point. I need a second, no a third, cup of coffee. Thanks for your correction.
Best Wishes
Hi Guys,
For a long time now, I've been fascinated by the research summarized in the biannual SPIVA reports. That fascination helps me in making asset allocation and active/passive investment decisions. You too just might find the SPIVA studies …
Hi Guys,
These exchanges suggest a considerable misunderstanding of my posts. I'll accept responsibility that I did not clearly state my position or intent. Sorry about that failure. Someday I'll learn to express myself more precisely.
In no wa…
Hi Msf,
I specifically quoted from the Link that you discussed because of its brevity. MFOErs are busy folks and might not be inclined to read extensive documentation. Barber and Odean generated many documents that illustrated the futility of fre…
Hi Old Skeet,
Congratulations on your investing success story. But not many share your experience. According to much investor research and many research conclusions, it is a rather rare happening.
That observation is "in line with research by Br…
Hi Guys,
If the market wizards are depending on the investing public to make wise decisions they will be sadly disappointed. Our crystal ball is not just cloudy, it is cracked. Test data demonstrates time and time again that it is not that we suf…
Hi Fundalarm,
I completely agree with everything that you said in your excellent post. I not only concur with the general thrust of your comments, but with every single claim. Your profession does provide a useful and meaningful service to many i…
Hi msf,
Thanks for your detailed review of my earlier postings. I surely do not remember them. I do like the DALBAR summaries. They do useful work.
Like most investment decisions, the usefulness of a financial advisor depends on the individual …
Hi Guys,
Thank you all for this informative exchange.
Here is a Link that discusses " a dirty little secret " about investment advisors that is not very secret whatsoever:
https://www.forbes.com/sites/robertberger/2016/12/19/the-dirty-little-secr…
Hi VintageFreak and All MFOers,
Congratulations VintageFreak on your survival! It appears the car didn't do as well as you did. Good for you.
Much of what happens on our highway system is location dependent. State stats vary considerably across…
Hi Guys,
I really like sexy TV ads. Often they are more entertaining than the shows they sponsor. A few ago, I was especially fond of the Carl's Jr. Ad campaigns. They attracted much attention. I'm not sure what they were selling. Here is an a…
Hi Guys,
Indeed, the active vs. passive debate has heated up recently. It will never end since I believe there will always be a cohort of active investors who will never be satisfied wth average market returns. More power to them.
The percentage…
Hi Guys,
Not saving whatsoever is a dangerous proposition.
Compromises often produce acceptable outcomes. It is not clear why some acceptable balance between a few luxury items and saving can not be reached. I suspect that most folks do this tra…
Hi Hank, davidrmoran, and msf,
Are any of guys longshoremen? Given the language, Hank's last statement suggests some possible coupling.
His closing comment quickly summarizes your great distaste for my posts. Often you misrepresent my positions,…
Hi Hank,
Making a point of the distinction between MFOer's differing ratings of an article as good, very good, or excellent is just being picayune. At our generic interaction level, it is a distinction without a meaningful difference.
From my per…
Hi Hank,
Thanks for your most recent contribution. An honest post on a controversial topic is always appreciated. The referenced article is indeed excellent. That's why I posted it.
The article is dominated by references to Wade Pfau observation…
Hi Guys,
Not a totally unexpected attack from a trio of MFOers who often submit Ad Hominem posts directed to discredit me. That troubles me not one iota. The more they protest, the more I suspect I'm making some positive inroads.
I certainly do …
Hi Ted,
Thanks for the references to the various forms of the investment Periodic Tables. In one simple graph the annual return variability of various asset classes is nicely illustrated with the color coding schemes. These graphs tell a very end…
