![]() He told everyone in the audience that value investing, and the teachings of Benjamin Graham were old news and no longer relevant. One was a seasoned star who was playing the big tech winners of the day and racking up huge gains. This transported me way back to 1999 when I went on the road with two other portfolio managers from other firms. While Marks explored a series of “justifications” people are using to explain the current “this time is different” world, one of them jumped out at me: “Companies and stocks can thrive even in the absence of profits.” That’s a 58 per cent outsized advance of the index over the underlying earnings growth each year. Over the same period, the S&P 500 had a total return CAGR (index and dividends) of 11.7 per cent. S&P 500 earnings grew at a 7.4 per cent compound annual growth rate (CAGR) from 2010-2018. Here’s the stock market story thus far since the 2008-2009 financial crisis: This was written just eight days before “Black Monday,” the worst day in stock market history.
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