A bear market is a value restoration process. Assets that had previously been priced for poor returns can again be expected to appreciate handsomely. Not only are prospective returns higher after declines, but risks are lower, as prices are no…
A motorsailer may not be the fastest boat, but it will always get there In my newsletter I track two exceedingly simple models, one for value and one for momentum, as applied to 20 different stock markets, a REIT index,…
A low-fuss absolute value approach for accounts with limited options There is an old rule of thumb that your percentage allocation to bonds should be 100 minus your age. This is because bonds are about half as volatile as stocks,…
Since the bottom of the crash 10 years ago, the S&P 500 has appreciated by a compound average of 15% per year, one of the strongest runs in history. S&P 500 Real Total Returns (after inflation, including dividends) Short-term…
The average piker would be better off in a savings account, but it has never been easier to be an elite investor. A haphazard approach to investing is the default among the public. Investors see an array of options from…
John Bogle, the founder of Vanguard and father of index investing, has long been using the following formula to estimate future 10-year stock market returns: Total Future Returns = Dividend Yield + Earnings Growth +/- Annualized change in P/E Ratio…
Most investors know that the US stock market is overvalued, as is often the case during the late stages of a bull market. This however doesn't keep them from staying long and bullish, since short-term expectations are predominant. In the…
Everyone knows about the P/E ratio, but nobody knows how to use it. Price / last year's earnings and Price / next year's earnings are pretty much worthless, yet these are the formulas we hear referenced the most. Why? Because…