UnThreaded | Threaded | Whole Thread (11) | Ignore Thread Prev | Next
Author: ptheland Big gold star, 5000 posts Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 78669  
Subject: Re: Trading in Retirment A/C Date: 8/6/2006 7:06 PM
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Recommendations: 0
Of the 98 randonly-selected 15-stock portfolios that Bernstein examined for the period 12/89-11/99, 77 beat the S&P500 return of 18.94% per annum.

You do realize that his methodology for coming to this conclusion is ... well ... crap. It is massively influenced by a survivorship bias.

He selected random 15 stock portfolios from the S&P 500 as of 11/30/99 and then looked at their returns from 12/89 - 11/99. Great. No real losers could be chosen. He eliminated all of the stocks that fell off of the S&P 500 over that 10 year period from his analysis.

So just tell me what 500 stocks will be in the S&P 500 in 2017. Then I can give you lots of portfolios that are likely to do well.

Frankly, that analysis isn't worth the electrons used to store it.


PS - The thought occurs to me that the date "11/30/99" is a typo and should be "11/30/89". However, since that piece was copyright 2000, he's had plenty of time to fix that typo. I can't be the first person to notice this problem.
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (11) | Ignore Thread Prev | Next


The Retire Early Home Page
Discussion on accelerating retirement day.
Post of the Day:
Saul's Investing Discussions

Skyworks Mid-Quarter Review
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.