Volatility, noise and the big picture
- September 13th, 2011
It is easy in volatile markets like we have at present to get caught up in the day-to-day action. Most investors have a much longer time horizon than do the markets. Most investors would be best served by turning off CNBC and focusing on the long term. We came across a handful of items that try to put both the overall market and investing strategies into some longer term context.
I understand that most people reading investment blogs are focused on actionable advice with a shorter-term time frame. However it is worthwhile revisiting some investment results that reflect on both short and long term investors. For instance looking at how momentum and credit ratings distinguish amongst stocks is important no matter how you slice and dice things.
The bottom line is that we live in a noisy financial world. Sometimes it make sense to step back and look at the bigger picture.
Items worth a read:
Better times are ahead if market patterns persist. (WSJ)
Taking a stab at estimating equilibrium risk premia on various asset classes. (Capital Spectator)
Buy-and-hold is a distinctly American phenomenon. (Free exchange)
Stock returns by debt rating. (Falkenblog)
The long-term power of momentum. (Crossing Wall Street)
[repeat] Updating the Swensen portfolio circa 2005. (Abnormal Returns)
Abnormal Returns is a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for sites to earn advertising fees by advertising and linking to Amazon.com. If you click on my Amazon.com links and buy anything, even something other than the product advertised, I earn a small commission, yet you don't pay any extra. Thank you for your support.
The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.
Abnormal Returns has over its seven-year life become a fixture in the financial blogosphere. Over thousands of posts we have striven to bring the best of the financial blogosphere to readers. In that time the idea of a “forecast-free investment blog” remains as useful as it did six years ago. More »
- Tuesday links: being the market
- Top clicks this week on Abnormal Returns
- Monday links: assuming more risk
- Sunday links: a clean slate
- Saturday links: studying failure
- Friday links: trading places
- Podcast Friday: active management
- Thursday links: making the illiquid liquid
- Wednesday links: human ingenuity
- Tuesday links: self-awareness and self-control