User 236735

Don't Confuse the Stock with the Company, or the Market with the Economy

"I look at a chart on my wall" ... dear, I haven't been to "business school" for many a year, but I thought this kind of reasoning and thinking had been dispelled of decades ago, you know, with William Sharpe and Harry Markowitz and the Capital Asset Pricing Model. For a more colloquial account, see Pery Mehrling's "Fischer Black and the Reveolutionary Idea of Finance." The dear boy in Cork, Ireland is living in never-never land if he thinks he can on a consistent basis outperform the market rate of return. The marekt rate of return is contingent on the economy, so I am not sure what the hell is going on with the question or the answer in this aritcle. It sould like gibberish to me. These days I am not sure who are the greater quacks: those that say they can beat the market, or those that say they can predict it. Look, you follow the mandates of CAPM, hold a diversified portfolio that rids you of alpha-risk, and take the return the market gives you. All else is the thinking of "Professors" much like the one in "Back To School" looking for a place to locate his classroom factory to which Rodney Dangerfield shouts out: "How about Fantasyland?"