The Great Depression “25-Year Recovery” Myth

If you’re worried about stocks taking a period of many, many years to recover following the recent market plunge, Mark Hulbert offers some insightful — and encouraging — news in The New York Times. While many have cited the fact that the Dow Jones Industrial Average took 25 years to get back to its pre-Great-Depression highs as reason to worry that the coming market recovery could take a upwards of 10 or even 20 years,… Read More

Stocks for The Long Run — Riskier than Stocks for The Short Run?

In his latest column for The New York Times, Mark Hulbert highlights an interesting new study that examines the concept of long-term risk in the stock market. The study, performed by University of Chicago Booth School of Business Professor Lubos Pastor and Wharton School Professor Robert F. Stambaugh, questions whether the concept of mean reversion really indicates that stocks are less risky over the long run, a theory that has been espoused by many investors… Read More

Study: Index Funds Top Mutual & Hedge Funds

Index funds may sound boring, but in his latest New York Times column, Mark Hulbert offers some data that indicates index funds may, in the end, actually yield higher net returns than mutual funds and even hedge funds. Hulbert details a study performed by Mark Kritzman, president and CEO of Windham Capital Management and a professor at M.I.T. In the study (presented in the Feb. 1 issue of Economics & Portfolio Strategy), Kritzman developed an… Read More

Hulbert: Signs of Investors Moving Back Toward Risk

In his latest column for MarketWatch, Mark Hulbert notes that a “dramatic reversal” is taking place in the bond market — and says it’s a reversal that could signal good things for the economy and the stock market. The yield spread between 10-year U.S. Treasuries and 10-year triple-A-rated municipal bonds has fallen significantly in the past month, Hulbert says. A month ago, those Treasuries were yielding 2.3% versus 3.53% for the munis. Given that interest… Read More

Hulbert: Graham’s Approach Endures

In his latest MarketWatch column, Mark Hulbert wonders whether the recent market plunge has shown that “maybe Ben Graham isn’t old-fashioned after all”. Over the past couple decades, Hulbert says, the strict, conservative approach used by Graham — who is known as both the “Father of Value Investing” and the mentor of Warren Buffett — had fallen out of favor on Wall Street. But as the current downturn has dragged on, Graham’s approach seems quite… Read More

Hulbert: Current Crisis is “Textbook Illustration” of Liquidity Shock

In his regular New York Times column, Mark Hulbert looks at the stock market’s behavior since the credit crisis began and references a 2001 academic study to glean some insight as to what we can learn from these types of periods. He writes, “you can view the markets’ behavior since mid-2007 as a textbook illustration of a statistical pattern uncovered years ago by two finance professors, Lubos Pastor of the University of Chicago and Robert… Read More

Hulbert: Small-Cap Value Stocks May Be Ripe for Impressive Gains

Small-cap value stocks are risky but they also historically produce jaw-dropping gains at the begining of bull markets, Mark Hulbert writes in the New York Times. Referencing academic research performed by professors Eugene Fama (University of Chicago) and Kenneth French (Dartmouth), Hulbert writes that small-cap value stocks (stocks with the lowest price/book ratios) “gained 17.1 percent, on average, in the first three months following the 13 market bottoms since 1969, equivalent to an annualized rate… Read More