Our Real Market Expectations For This Year

 


Location: 24 Mill Pond Dr, Granby, CT 06035, USA

Comments

Post a Comment

Popular posts from this blog

The Four Most Dangerous Words

Image
The Four Most Dangerous Words... The late great Sir John Marks Templeton - of Templeton Growth Fund fame - once quipped that the four most dangerous words to an investor were: "this time is different." Many market strategists warn that the sky is falling or that the investing principles that worked in the past no longer hold true in this new world of artificial intelligence and political unrest. The truth is that the facts and situations are (slightly) different from anything in the near or distant past. The rest of the story is that the human reaction, however, is the same and reasonably predictable. Read MORE ! Mean Reversion Works In my blog post two weeks ago, I used the analogy of a spring traveling through time while being exposed to compression and extension forces. This spring never gets smushed into a pancake - just the way it never snaps in half. When the forces are briefly taken away, the spring reverts back to the normal (unforced) state. This same principle can b...
Read more

Our Real Expectations For This Year

Image
  If each of us can replace just one interaction filled with hate to one drawn to love and just one reaction fueled by fear to one blessed with hope, then 2024 will be a VERY bright year. The best way to predict the future is to create it. Our future starts today!
Read more

Rescaling The Obvious

Image
  Source : Shiller Data, JQR Capital Earnings Yield Returns Last week we glanced at the predictive power - as measured by the correlation coefficient - between earnings yield and stock returns. We see from the chart shown below that the predictive power appears to increase almost monotonically as we look further forward in our investment horizon. This again highlights the idea that over the long run, fundamentals (corporate earnings are about as fundamental as things get) matter the most to investment returns. Source : Shiller Data, JQR Capital Rescaling The Obvious  The type of chart we display has an affect on our perception of this data. The previous chart is the bar style with an unscaled horizontal axis. This makes it seem like we want to hold our portfolio positions for 240 months - or 20 years - before hitting the rebalance button. Transaction costs (as measured by trading commissions) have recently dropped to near zero due to digitization and competition. We now change...
Read more