The Capitalism Distribution PDF

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The Capitalism Distribution: Fat Tails in Action

Quick, before you read this post, ask yourself these questions: 1. What percentage of stocks beat their benchmark index over their lifetime? 2. What percentage of stocks have a negative return over their lifetime? 3. What percentage of stocks lose essentially all of their value? Not sure? The answers to all three questions are below. Want to know why a monkey throwing darts...

AlphaClone Beta Launch!

Take the tour here!Free Warren Buffett clone example here. Beats the market by 10% a year since 2000, including outperforming the market by 20% in 2008. (Those number agree with the historical numbers found in this academic study.) Top holdings include WFC, KO, PG, COP, BNI, AXP, KFT, JNJ, USB, and WSC.Screenshot of Buffett clone below:Free...

Market Timing is Impossible

That was the response of a certain Nobel Laureate when I tried to get him to read my paper "A Quant Approach to Tactical Asset Allocation." He refused to even take a look at it. This year has certainly been the perfect storm for buy and hold investors. Everything has gone down - Sotcks, Foreign Stocks, REITs,...

Asset Allocation Backtester, Quant Funds, and Market Timing

Of the 10,002 US Stock Mutual Funds Morningstar tracks, ZERO are up on the year and the average performance is -43.63%.Of the 2,892 Foreign Stock Mutual Funds, ZERO are up on the year, ZERO are down less than -10%, and the average performance is -50.75%.----It is about time for the Hedge Fund Masters update, but since AlphaClone is (finally)...

You Should Listen to Jim Rogers

From December 2007:Rogers, who is short Fannie Mae shares, is also short Citigroup (C, news, msgs) and highly negative on its prospects, too."Technically, it's bankrupt, with gigantic off-balance-sheet derivatives positions whose value it cannot possibly know," he says. Though he believes some large banks can and will go under in the next year or two under the weight of...

Global Multi-Asset Fund

PIMCO has a new fund out managed by El-Erian and crew - Global Multi-Asset PGMDX.  Although it looks expensive with a 1.5% managment fee. Fact sheet here.Interview with the managers here.----A cool art site to pick up art on the cheap.-----Nice quote I saw at a coffee shop this AM:"The only people for me are the mad ones, the ones...

Weekend Linkfest

I always save old copies of Barrons that had investment ideas I found interesting, but wanted to revisit at a later time. I then end up losing them and forgetting about the investment thesis - which is why ImpactOven looks like a cool new site.----The consumer is definitely not buying.----Because of the high taxes in Denmark, the #1...

Vonnegut on the Financial Markets

I really miss Kurt Vonnegut. From Galapagos, circa 1985: The thing was, though: When James Wait got there, a worldwide financial crisis, a sudden revision of human opinions as to the value of money and stocks and bonds and mortgages and so on, bits of paper, had ruined the tourist business not only in Ecuador, but practically everywhere...Ecuador, after...

Wahoo Wha??

A lot of the endowments are struggling with the recent market meltdown. Unfortunately, my alma mater happens to be one of the worst performers.As an aside, I have always wondered why investors in private equity don't hedge their portfolios against long bear markets? The biggest risk factors to a PE portfolio are a bad economy...