Stocks for the Long Run: The Definitive Guide to Financial Market Returns & Long-Term Investment Strategy / Edition 4

Stocks for the Long Run: The Definitive Guide to Financial Market Returns & Long-Term Investment Strategy / Edition 4

3.8 12
by Jeremy J. Siegel
     
 

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ISBN-10: 0071494707

ISBN-13: 9780071494700

Pub. Date: 11/27/2007

Publisher: McGraw-Hill Professional Publishing

For more than a decade, Stocks for the Long Run has been the authoritative guide to understanding market forces and building a successful portfolio. In this new fourth edition, Jeremy Siegel updates his argument for long-term stock market investment with: comparisons of ETFs, mutual funds, and index options and futures; evidence that the rapid growth of

Overview

For more than a decade, Stocks for the Long Run has been the authoritative guide to understanding market forces and building a successful portfolio. In this new fourth edition, Jeremy Siegel updates his argument for long-term stock market investment with: comparisons of ETFs, mutual funds, and index options and futures; evidence that the rapid growth of emerging markets will not only continue but may accelerate; insight into the benefits of fundamental indexation over market value indexation; an updated look at the surprising validity of Calendar Effects; and fresh analysis of the best-performing stocks since the formulation of the S&P 500 Index.

Praise for previous editions of STOCKS FOR THE LONG RUN

"One of the ten best investment books of all time."
--The Washington Post

“A simply great book.”
--Forbes

“One of the top ten business books of the year.”
--BusinessWeek

“Should command a central place on the desk of any 'amateur' investor or beginning professional.”
--Barron's

“Siegel's case for stocks is unbridled and compelling.”
--USA Today

“A clearly written, neatly organized, highly persuasive exposition that lifts the veil of mystery from investing.”
--John C. Bogle, Founder and former Chairman, The Vanguard Group

Product Details

ISBN-13:
9780071494700
Publisher:
McGraw-Hill Professional Publishing
Publication date:
11/27/2007
Edition description:
REV
Pages:
436
Product dimensions:
7.70(w) x 9.50(h) x 1.40(d)

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Stocks for the Long Run: The Definitive Guide to Financial Market Returns & Long-Term Investment Strategy 3.8 out of 5 based on 0 ratings. 12 reviews.
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WhartonGrad More than 1 year ago
Not to mention the survivor bias of Siegel's dataset, but how can any asset class - stock, commodities, you name it - provide a return on invested capital higher (in the long run) than the long-run growth rate of global GDP? It's mathematically impossible b/c the stock market would consume global GDP. I think this suggests that the long run equity premium is lower than what people have historically assumed - and with that the long-run return of equities as an asset class. Siegel writes a short page or two on the "equity premium puzzle" but mis-understands it. Siegel rode to fame on the same leveraged economy that others have (Greenspan, etc.). He should revisit his work. I recently bought this with the hope of achieving insight, but found none.
Anonymous More than 1 year ago
Political_Calculations More than 1 year ago
This is Jeremy Siegel's seminal work covering much of the theory behind what drives stock prices. No matter what level of knowledge you might have of the market, whether as a novice investor or as an experienced pro, there's something new you can learn from Stocks for the Long Run.

Siegel combines theory with history and summarizes the results from some very interesting research in Stocks for the Long Run. Each edition of the book brings new data and new analysis to the surface. A very good example of the latter is the fourth edition's introduction of what Siegel calls the "Noisy Market Hypothesis," which previously had only been introduced in an article Siegel contributed to the Wall Street Journal in July 2006.

Meanwhile, Stocks for the Long Run is an essential resource for any investor since it not only provides historic data to use for reference, it also answers questions that might motivate investment decisions, such as "Does the Dogs of the Dow strategy really work?" or "Is there something to the January Effect?"

But none of those things is what the main thrust of the book is about. Siegel's basic premise argues that stocks, held for very long periods of time, deliver superior returns compared to other types of investments. Siegel clearly has the weight of history to back his arguments, and as long as the future continues to resemble the past and people tomorrow continue to act like people a hundred years ago, thirty years ago, ten years ago or yesterday, the outperformance of stocks over other types of investments over long periods of time is likely to continue.

If you're an investor, or are studying to go into the financial industry, or are a long-time financial and investing professional, a copy of Jeremy Siegel's Stocks for the Long Run belongs on your bookshelf. Highly recommended.

-- Ironman at Political Calculations
Anonymous More than 1 year ago
LOTONtech More than 1 year ago
Holding stocks for the long run is a totally sound idea -- as long as you get in at the right time! Buying stocks after the 1929 Wall Street Crash, holding them and reinvesting the dividends, would have been a great idea. Buying stocks immediately prior to the crash, and holding them all the way down, would not have been so smart. More recently: buying stocks in mid 2007, and particularly financial stocks that had apparently good fundamentals, and holding them through the massive decilnes would also not have been too smart. To be fair, this book does allude to the importance of timing in its talk of Raskob in Chapter 1 -- but then more-or-less dismisses it.

I'm interested in the value investing vs. market timing trade-off, and so I explored it myself using real data in "Stock Fundamentals On Trial: Do Dividend Yield, P/E and PEG Really Work?". I took a much shorter (recent) timeline than Siegel, so a direct comparison is not valid. But I justify this because most investors, despite their best intentions, will not hold stocks that fall in price unless the fall is very temporary. So they're market timers after all: it's just that they time their exits (badly) and don't time their entries at all.

I agree with Siegel's charts that show how well stocks have performed over the decades. In fact, I included a chart (figure 38) in "Financial Trading Patterns" showing how a buy-and-hold approach would have beaten market timing over a 23-year span to October 2007. But my point is this:

If I had the data, I could perhaps draw a chart showing the continual rise of horse-and-cart production over hundereds of years. But it all came to a swift end when Henry Ford appeared on the scene. Holding Stocks for the Lun Run can work, and it has worked. But we can't guarantee that it always will; and it will take you a long time to find out either way. Or, you'll give up (when you have to) at exactly the wrong time.