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Strategies & Market Trends : Bob Brinker: Market Savant & Radio Host

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To: Boca_PETE who wrote (2822)1/15/1998 7:38:00 PM
From: sea_biscuit  Read Replies (2) of 42834
 
It appears that the measurement is unfairly taken right at the peak of that parabolic rise before the crash. Interesting comparison, but how meaningful is it ?

I think it is pregnant with meaning! And I also think it is absolutely fair. After all, the name of the newsletter is Marketimer! Ain't it?

Interestingly enough, the totally passive indexed approach that is advocated in Chapters 12 and 13 of the book at fee-only-advisor.com would have produced 9.94% annualized returns (assuming an effective annual expense ratio of 1.0%) for a 40% bond, 60% stock portfolio from 1987 to 1994 (I don't have the numbers for 95 and 96, but if we had them, I am pretty sure it would look even better). Make it a 100% stock portfolio and the returns would rise to 12.29%

Dipy.
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