The Four Pillars of Investing: Lessons for Building a Winning Portfolio 5 docx

... statisticians call a “standard deviation” (SD). This can be thought about as the degree of “scatter” of a series of values about the average. For example, the average height of adult males is about ... through the centuries. Bills, on the other hand, were simply pieces of paper of a certain face value, purchased at a discount. For example, the Bank of Eng...

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... this is the case of companies that are buying back their shares. A company that has grown its earnings by 5% per year and annually buys back 5% of its outstanding shares will appreciate by 10% ... dividends for each year to the present, then add them all up. But with a few mathematical tricks, this nut is easily cracked. A Stream of Future Dividends, Forever and Ever, Amen...

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... yield an average of about 7% per year. The downside is that because they can reinvest only a small portion of their profits, they usually carry a large amount of debt and, in the aggregate, do ... high-octane Manhattan Fund. Unfortunately for Tsai, just at that point, he was struck with a fatal case of chimpanzee syndrome. The years 1966–1967 were mediocre for Manhatta...

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... size of the fund, the size of the company, and the total amount transacted. As a first approximation, assume that it is equal to the spread. The four layers of mutual fund costs: • Expense Ratio • ... your 100 The Four Pillars of Investing This page intentionally left blank made possible the storage and analysis of a mass and quality of stock data that C...

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... practices the lack of historical knowledge is the one that causes the most damage. Consider, for example, the principals of Long Term Capital Management, whose ignorance of the vagaries of financial ... time. For this generation, the horses are already out of the barn, and it may be another 30 years the typical Let’s get a bit of nomenclature out of the way...

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... money when their loansare made in the form of a bank draft, as they almost always are.) Now, all of the necessary ingredients for a bubble were present: a major shift in the financial system, ... amounts of capital now available. There was even a fashionable new technology involved: the laws of probability. Fermat and Pascal had recently invented this branch of mat...

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... than all of them? On top of that, there are tens of thousands of professional investors using the kind of software, hardware, data, technical support, and underlying research that you and I can ... next major error that investors make is the assumption that the immediate past is predictive of the long-term future. Take a look at the data from the table at the begin...

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... were buoyantthat year.Then,asnow, tech stocks wereall the rageand trad- ing volume was high,atleast bythe standardsof the day. Brokersat other firms, all ofwhomworked on acommissionbasis, were making money ... capableofrationalizing the damagetotheir clients’ portfolios in a multitudeofways. They provide valuableadvice and discipline. They areableto beat the market. They provide mor...

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... rate would actually have depleted all the portfolios in about 15 years. This means that a “penalty” of about 1 .5% –2% was extracted by the luck of the draw.” In other words, a particularly bad returns ... 1.08%. In the bond arena, this 0.80% expense gap is an insurmountable advantage—even the Almighty himself is incapable of assembling a portfolio of GMNAs capable...

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... 8%6%4%2%— Small Cap Vanguard Tax-Managed 25% 22 .5% 20% 17 .5% 15% 12 .5% 10% 7 .5% 5% 2 .5% — International Vanguard REIT (VA) 15% 13 .5% 12% 10 .5% 9% 7 .5% 6% 4 .5% 3% 1 .5% — Treasury Ladder—2 .5% 5% 7 .5% 10% ... pension 266 The Four Pillars of Investing • 5% Vanguard Small-Cap Value Index (IRA) •12 .5% Vanguard Tax-Managed International • 5% Vanguard REIT (VA) •12 .5% Treas...

Ngày tải lên: 20/06/2014, 20:20