No Margin Of Safety No Room For Error
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S&P 500 has achieved a total return, including dividends, averaging -0.03% annually. Over the past margin of safety formula 13 years, the total return for the S&P 500 has
Seth Klarman
averaged just 3.23%. Why have stocks performed so poorly? One word. Valuation. If investors take nothing else from these commentaries, there are two primary lessons that should be clear. First, the poor market returns that investors have achieved for more than a decade were entirely predictable during the late 1990's, based on the historical relationship between valuations and subsequent returns. Second, from current valuations, the similarly poor returns that investors are likely to achieve over the coming 5-7 year period are also predictable based on the same evidence. While we regularly emphasize that valuation is not particularly useful as a timing tool, we know of no factor with a better record in setting expectations for long-term market returns. We spend a great deal of time discussing market conditions, economic policy, investor sentiment, and other factors in these weekly comments. But it is critical to recognize that these factors simply modify the short-term course that market returns take over periods of perhaps 1-2 years. They do not significantly affect the long-term course of market returns. Once valuations become unusually rich, disappointing long-term returns become baked in the cake. We frequently cite our projections in terms of 10-year returns, since that horizon is a common definition of "long-term." Generally speaking, however, large deviations of market valuations from their historical norms have generally been corrected within about 7 years. As a result, 7-year return projections are somewhat more sensitive to overvaluation and undervaluation than 10-year returns are. Think of it this way. Suppose that
investing. True geniuses tend to make things simpler, not more confusing. Buffett is no exception. Buffett simplifies investing down to the following: “All there is to investing is picking good stocks at good times and staying with them as long as they remain good companies.” That doesn’t sound overly complicated – because it isn’t. Click here to see 17 of Warren Buffett’s best quotes analyzed. Buffett says there are 3 things that make a successful investment: Good stocks (strong competitive advantage) Good times (low prices) Stay with them as long as they remain good investments (let them compound your wealth) You don’t have to be a genius to follow this plan… “Investing is not a http://www.hussmanfunds.com/wmc/wmc101011.htm game where the guy with the 160 IQ beats the guy with the 130 IQ” - Warren Buffett Warren Buffett’s mentor was Benjamin Graham – the father of value investing. Three of Graham’s ideas greatly impressed Buffett. He went on to say that: “(He) believes those ideas, 100 years from now, will be regarded as the three cornerstones of sound investing.” Warren Buffett’s 3 cornerstones of sound investing are: Look at stocks as small pieces of http://www.suredividend.com/warren-buffett-sound-investing-cornerstones/ a business Look at market fluctuations as your friend rather than your enemy Margin of safety This article takes a deeper look into each of these 3 investing cornerstones. Look At Stocks as Small Pieces of a Business For many (if not most) individual investors, the stock market is a large virtual casino. If you pick the right 1, 2, 3, or 4 digit ticker symbol, you could double or triple your money! If you pick the wrong one, you could lose it all. It’s easy to see why… Stock quotes are updated in (nearly) real time, giving markets the same frenzied tempo as you see on a spinning roulette wheel in Las Vegas Casino. You can pull up lists of the top performing stocks every day to see the ‘big winners’ and ‘big losers’ If only you invested in the big winners every day… You’d be a billionaire in no time! This has led to the prevalence of penny stocks. A stock could be worth $0.01 today, and go to $1.00 tomorrow – giving you 100x returns in a day! Of course, this rarely (if ever) happens. Penny stock sites like to hype up your brain with the (largely false) idea of big returns that are easy to get. Informed investors know better. Traders with a gambling mentality trade very frequently. Who stands to gain from rap
εμάς.Μάθετε περισσότερα Το κατάλαβαΟ λογαριασμός μουΑναζήτησηΧάρτεςYouTubePlayΕιδήσειςGmailDriveΗμερολόγιοGoogle+ΜετάφρασηΦωτογραφίεςΠερισσότεραΈγγραφαBloggerΕπαφέςHangoutsΑκόμη περισσότερα από την GoogleΕίσοδοςΚρυφά πεδίαΒιβλίαbooks.google.grhttps://books.google.gr/books/about/Roofing_Research_and_Standards_Developme.html?hl=el&id=TDMgtNXfFmUC&utm_source=gb-gplus-shareRoofing Research https://books.google.com/books?id=TDMgtNXfFmUC&pg=PA99&lpg=PA99&dq=no+margin+of+safety+no+room+for+error&source=bl&ots=029R0b_brn&sig=4Lb5Z04yjUnhVIeS_vkPVQda5Us&hl=en&sa=X&ved=0ahUKEwip05Oz1ePPAhVP7WMKHYnFDpsQ6AEIPjAG and Standards Development: 6th VolumeΗ βιβλιοθήκη μουΒοήθειαΣύνθετη Αναζήτηση ΒιβλίωνΑποκτήστε το εκτυπωμένο βιβλίοΔεν υπάρχουν διαθέσιμα eBookASTM InternationalΕλευθερουδάκηςΠαπασωτηρίουΕύρεση σε κάποια βιβλιοθήκηΌλοι οι πωλητές»Αγορά βιβλίων στο Google PlayΠεριηγηθείτε στο μεγαλύτερο ηλεκτρονικό βιβλιοπωλείο του κόσμου και margin of ξεκινήστε να διαβάζετε σήμερα στον ιστό, το tablet, το τηλέφωνο ή το ereader σας.Άμεση μετάβαση στο Google Play »Roofing Research and Standards Development: 6th Volume, Τόμος 6Walter J. Rossiter, Thomas J. WallaceASTM International, margin of safety 1 Ιαν 2007 - 128 σελίδες 1 Κριτικήhttps://books.google.gr/books/about/Roofing_Research_and_Standards_Developme.html?hl=el&id=TDMgtNXfFmUC Προεπισκόπηση αυτού του βιβλίου » Τι λένε οι χρήστες-Σύνταξη κριτικήςΔεν εντοπίσαμε κριτικές στις συνήθεις τοποθεσίες.Επιλεγμένες σελίδεςΣελίδα ΤίτλουΠίνακας περιεχομένωνΕυρετήριοΑναφορέςΠεριεχόμεναUnderstanding LowSloped Roofs Under Hurricane Charley From Field to Practice3 Artificial Roofing Slates and Shingles16 Critical Evaluation of Existing Specifications for Polyisocyanurate ISO Foam Insulation Boards in Roofing Applications22 Pilot Study on Wind Uplift Resistance of Adhesive Applied Low Slope Roofing Systems32 Quality Assurance Program for Soldering Copper Roofs49 Remediating Basement Leaks59 A Case History65 Investigation of the Effect of Heat on Specially Formulated Thermoplastic Polyolefin TPO Films by Thermogravimetry Dynamic Mechanic