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Pastimes : The Justa & Lars Honors Bob Brinker Investment Club
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To: Oblomov who wrote (8008)8/23/1999 10:40:00 AM
From: Kirk ©  Read Replies (1) of 15132
 
It is obvious that some people beat the market by a wide margin consistently; whereas, most players underperform. I would guess that the distribution of returns among the players in the market is shaped like a negative exponential distribution. IMO, this means that it is possible to outperform the market, either through stockpicking, or asset allocation.

Excellent points. I think that EMH holds much better for a $10B mutual fund but for a small investor of say under $10M....it is much easier to beat the market if the investor can detach their emotions from their stocks, indicators, etc.

I like the idea of learning Bob's indicators and then being able to judge for yourself when the risk/reward is right for you or even just vary your allocation to stocks according to risk (what I do). As p/e's have gotten above nose bleed levels, I have been pulling from my winners that are way out of whack with 4% guideline and putting them into well yielding bonds (GNMA and intermediate) plus cash.

Bob teaches alot of good stuff. I wish most would forget the magic sell signal and just look at what he is teaching and adjust their allocations accordingly. If the signal ever materializes, you might be surprised and be ready for it or even already at an allocation you want. What I am looking for is all that money on the sidelines to come rushing back in to stocks, driving sentiment to 80% and having bond yields skyrocket as nobody want to buy bonds.... I'll sell more stocks then and buy bonds as that is how I see it peaking out.

JMHO
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