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Boris Marjanovic  

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  • Profiting From Market Randomness [View article]
    MarketTrendSignals,

    I think you better read the whole article next time before making foolish comments.

    "The daily market moves are random noise, but over a long time the market follows its rules and exhibit a pattern."

    I said in the short run the market is random (i.e., anything can happen). In the long run, however, the market does seem to have more wining days than losing days, which means there is a long term upward trend.

    Again, read the entire article next time before commenting please, you made yourself look pretty silly right now.
    Feb 24, 2015. 07:07 PM | 2 Likes Like |Link to Comment
  • Intelligent Investing Is (Literally) Child's Play! [View article]
    David Van Knapp,

    "As the commenter above, I don't understand your distinction between stock picking by humans and stock picking by quant models. Didn't humans create the quant models?"

    There is extensive research on this topic. It's an undeniable fact that simple quant models crush humans. This is because the models are very systematic. They do the same thing over and over again. They never panic (like humans do). If built properly, they will usually pick stocks that me or you would tend to avoid because of our inherent flaws and biases (but the stocks we avoid tend to perform the best). There are also many other reasons why quant models consistently outperform. I will need to write an article on this topic soon.
    Feb 17, 2015. 09:20 PM | Likes Like |Link to Comment
  • Intelligent Investing Is (Literally) Child's Play! [View article]
    Jerbear,

    "Is 60/40 really a good ratio given the state of the bond market and the Fed anxious to raise?"

    The beauty of this strategy is that it requires no prediction making. When the market does well you make money. When the market crashes, investors rush into bonds driving up bond prices and your overall losses are minimized (and you might even turn a profit). Historically this strategy has generated 9-10% per annum returns, which beats most hedge funds.
    Feb 17, 2015. 09:11 PM | Likes Like |Link to Comment
  • Intelligent Investing Is (Literally) Child's Play! [View article]
    JandL55@yahoo.com,

    "Boris, have you looked at Jim's (your highly paid assistant) portfolio if it was held for several years instead of a new port each year?"

    I have and the performance was actually better when you do less frequent rebalancing. I guess we are in a strong bull market so most stocks will go up, regardless of which ones you pick.

    "Some argue against your article by saying they do well on options and I assume they do. But for every winner there is a loser. So what does it prove?"

    As I explained at the start of this article - everyone is above average in their own minds. Everyone says they have an amazing track record until you look at their actual performance.
    Feb 17, 2015. 10:38 AM | Likes Like |Link to Comment
  • Intelligent Investing Is (Literally) Child's Play! [View article]
    Nitebreed,

    "No such thing as luck."

    I guess there is no such thing as lottery winners either.
    Feb 17, 2015. 10:32 AM | 2 Likes Like |Link to Comment
  • Intelligent Investing Is (Literally) Child's Play! [View article]
    Robert Duval,

    I want to offer you a challenge. Pick any 10 stocks from the S&P 500 index that you think will do the worst over the next 12 months. This means that I want you to actually try your best to lose (i.e., to underperform) the market. If you play this game for a few years you will see that some years you will "accidentally" outperform the market. This will prove to you that luck is enormously important when it comes to investment success.
    Feb 17, 2015. 10:27 AM | 2 Likes Like |Link to Comment
  • Intelligent Investing Is (Literally) Child's Play! [View article]
    WallStreetDebunker,

    You are absolutely correct. Buffett is donating 99% of his money to charity when he dies and he wants the charity to invest it into an S&P 500 index fund. Buffett is not a fool, he knows passive investing works.
    Feb 17, 2015. 10:20 AM | 1 Like Like |Link to Comment
  • Intelligent Investing Is (Literally) Child's Play! [View article]
    Ryan Lynne,

    "Also, the last 3 years represent a massive bull market, a random strategy is bound to do well when everything is going up: Everyone is a genius in a bull market."

    Yes, the last 3 years represent a massive bull market. As long as one does not trade too frequently and has a decently diversified portfolio of stocks they will do pretty well. However, interestingly enough the average hedge fund still somehow managed to underperform the market every year. I guess not everyone is a genius in a bull market - some people are actually pretty dumb.
    Feb 16, 2015. 08:51 PM | Likes Like |Link to Comment
  • Intelligent Investing Is (Literally) Child's Play! [View article]
    Robert Duval,

    I do believe that the market is irrational and can make huge mistakes once in a while. However, this still doesn't change the fact that most people are pretty terrible stock-pickers.
    Feb 16, 2015. 03:51 PM | Likes Like |Link to Comment
  • Intelligent Investing Is (Literally) Child's Play! [View article]
    retailinvestor,

    Studies actually have looked at thousands of individual brokerage accounts and have found the same thing - most people underperform the market. However, the ones who trade the least (typically women) tend to have the best returns.
    Feb 16, 2015. 11:58 AM | 1 Like Like |Link to Comment
  • Intelligent Investing Is (Literally) Child's Play! [View article]
    ron3637,

    If I was just an average person and didn't want to spend any time learning about the financial markets, this is what I would do: 60% low-cost index fund (or ETF equivalent) and 40% bonds (or ETF equivalent). I would rebalance once per year to get it back to 60/40. Simple strategy and will outperform most actively managed funds in the long run.
    Feb 16, 2015. 11:54 AM | Likes Like |Link to Comment
  • Intelligent Investing Is (Literally) Child's Play! [View article]
    taarheel,

    "It's sort of the Heisenberg principle at work in the investing world. By observing results (and reacting to them), we change them."

    That is a very interesting analogy. I might use it in future articles. Thank you!
    Feb 16, 2015. 11:51 AM | Likes Like |Link to Comment
  • Intelligent Investing Is (Literally) Child's Play! [View article]
    Carlos Gabriel,

    I guess we will have to see. Although, I am willing to bet Jim will at least outperform the average hedge fund (which is sadly not very difficult to do).
    Feb 16, 2015. 11:47 AM | Likes Like |Link to Comment
  • Intelligent Investing Is (Literally) Child's Play! [View article]
    Envoy Global Research,

    "In general, though, based on my experience, I do think some sort of basic strategy will outperform sheer random picks."

    I agree, it is possible to outperform by using a basic strategy. Preferably a quantitative strategy where you have a simple computer model selecting the stocks for you.
    Feb 16, 2015. 11:44 AM | Likes Like |Link to Comment
  • Intelligent Investing Is (Literally) Child's Play! [View article]
    davidjr74,

    "While it may be true that a lot of investments are simply left up to chance...how do you explain investors who simply have beaten the market consistently over many years? Surely, that can't all be luck."

    If you have 100 million coin-flippers, I can guarantee you that a few will end up flipping heads 20+ times in a row (the equivalent of a good long term investment track record like Buffett's). Surely, these coin-flippers must be skilled at flipping coins, right? There is absolutely no way they could have been lucky, right? I think we both know the answer - it was just blind luck!
    Feb 16, 2015. 11:39 AM | Likes Like |Link to Comment
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