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.

Strategies & Market Trends : The Art of Investing -- Ignore unavailable to you. Want to Upgrade?

To: sense who wrote (1601)	3/23/2021 8:34:05 PM
From: Sun Tzu	Read Replies (2) \| Respond to of 10599

You need to read the article before we can discuss it. There is no point to do otherwise. The article is actually quite accessible and (as far as academic finance papers go) interesting. As an FYI, they picked bubbles a priori - defined as something that crashed 40% from its top. So you already knew for a fact that you are dealing with a bubble. Nonetheless it was pretty impossible to deal with that little thing you mentioned - the timing. For the most parts, they confirmed Fama's conjecture. But because they took a nuanced approach and split hairs, they managed to make some additional interesting (and somewhat useful) observations. PS As you can see, people have researched and analyzed bubbles - some of them even won nobel prize.

To: sense who wrote (1601)	3/23/2021 8:55:49 PM
From: Sun Tzu	Read Replies (1) \| Respond to of 10599

Re: Easy enough to establish threshold values saying "beyond this point, I want to be out of the market"... and thus lower risk I am not so sure that doing so is any easier than saying that the stock market in general is too risky and I am going to stay out. During the dot-com bubble there were many and continuous calls about the bubble. And every time there was a market pullback, the bears would scream that the end is near. But they were wrong for so long, that when the crash finally came, the prices still held up above where the bears had called it a bubble. So ultimately you would have lost if you had listened to them in the first place. And this is one of the key findings of the research.