Value Investing Strategy (Strategy Overview)

Allocations for December 2024 (Final)

Cash TLT LQD SPY

Momentum Investing Strategy (Strategy Overview)

Allocations for December 2024 (Final)

1st ETF 2nd ETF 3rd ETF

Equity Premium

Governments are largely insulated from market forces. Companies are not. Investments in stocks therefore carry substantial risk in comparison with holdings of government bonds, notes or bills. The marketplace presumably rewards risk with extra return. How much of a return premium should investors in equities expect? These blog entries examine the equity risk premium as a return benchmark for equity investors.

Triumph of the Optimists (Chapter-by-Chapter Review)

February 1, 2005 - Big Ideas, Bonds, Currency Trading, Equity Premium

Triumph of the Optimists: 101 Years of Global Investment Returns by Dimson, Marsh and Staunton (2002) is thorough, logical and concise. With scores of illustrative graphs and figures, its statistics are accessible and its style straightforward. Its message, however, is somewhat at odds with the title. Below is a chapter-by-chapter review of the insights in this book: Keep Reading

One Up on the Fed Model?

November 10, 2004 - Equity Premium, Fundamental Valuation

In their June 2003 paper entitled “A General Theory of Stock Market Valuation and Return”, Christophe Faugere and Julian Van Erlach contend that past stock returns are overstated and develop a market valuation formula that out-fits the Fed Model. Specifically, they show that: Keep Reading