Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Madharry who wrote (124296)	9/4/2010 8:00:05 PM
From: Knighty Tin	Respond to of 132070

The excuse lies in the weaknesses of quantitative models. The greatest weakness is the fact that the numbers you are massaging may be fake. In the past 5 years, if numbers had been correct, you would have been a fool not to buy financial stocks by the truckload. Extremely low price earnings ratios and high dividends. Plus terrific credit ratings from the third party ratings agencies. AIG was a AAA credit. Unfortunately, the earnings were lies, the dividends disappeared and the credit ratings cratered. A mutual fund mgt. co. has to pound the pavement and press the flesh. You can't get access to all the #s, but you can decide who you trust. If somebody cannot explain what is in a derivatives portfolio that is a huge % of their holdings, you should probably not buy their stock. Even Buffett suckered in on derivatives, but he didn't make as big a bet as many others did. The Bridgeway Large Cap Value Fund has made a little money in the past 5 years, a little more than the S&P 500. Why those guys didn't help the other ones is an internal question they have. quote.morningstar.com