Id,
"regulars" on this board were exhibiting major groupthink about the strategy and were attacking of anyone questioning it.
Ture. I believe there were also "regulars" that didn't exhibit major group think and that didn't attack anyone, at least not on any regular basis. Therefore, your comment is unhelpful at least to me.
the Gorilla Game has been shown to be a questionable strategy.
True. Until you provide an investment strategy that doesn't prove to be questionable from time to time, I believe that observation is also unhelpful.
However, it DID present an investment strategy that failed miserably in a bear market.
True. Most stock strategies other than shorting strategies fail miserably in a bear market. That's true especially of strategies that outperform during bull markets; it's unbelievably difficult to find a stock strategy that does as well as the broad market in both bull and bear markets. That's why, for me, your comment is unhelpful again.
Since the book was published, we have only enjoyed only two bull markets and one bear market. The strategy was never designed to be measured only during bear markets. For me, the jury is still out because of the lack of ample time to evaluate use of the strategy in real time.
However, I'll offer anecdotal evidence of the stocks that became my two largest holdings, thanks primarily to the Gorilla Game strategy. My purchase of Siebel stock has appreciated at an average annual rate of about 9.9%. During the same 5 1/2-year period, the S&P 500 has declined at an average annual rate of about 1%. Similarly, my purchase of Qualcomm stock has appreciated at an average annual rate of about 20.7%. During the same 4 1/2-year period, the S&P 500 has declined at an average annual rate of about 4.7%. (Though those S&P 500 rates don't include re-invested dividends, including them would still indicate dramatic underperformance compared to Siebel and Qualcomm.) Though that's only anecdotal evidence about one of thousands of periods that could have been measured, you can probably appreciate why it's unimportant to me to measure performance only during the bear market.
--Mike Buckley |
