Getting My Geek On
I have said before that I am something of a geek. In addition to reading news, SEC filings and anything else I can get my hands on, I am fond of academic studies on the markets. I'm among a small group that passes these studies around like baseball cards, looking for an edge or additional tool to help us succeed. I skim a lot of them and throw them away because so much academic research is the result of a "publish or perish" mentality, which tends to produce faulty work with erroneous conclusions by authors writing for tenure and not for financial gain. A few, however, produce exploitable ideas that can make me a better investor.
I like was the work of recently deceased pioneer quantitative investor Robert Haugen. Along with Nardin Baker of Guggenheim Investments, he published a study entitled "Low Risk Stocks Outperform within All Observable Markets of the World." The paper was a follow-up to earlier work by the two that showed higher risk did not necessarily equal higher reward. This study applied the principle of buying less volatile stock to 33 different markets around the world between 1990 and 2011....546 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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