Excess Returns
Excess Returns

Excess Returns

First of all, it was not home runs and leverage that drove these returns. Virtually all of these returns were achieved through diversified portfolios with significant turnover across periods ranging from 10 to almost 60 years. (Location 90)

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Further, some returns were achieved on portfolios that were so large that the market operator’s freedom of action and flexibility were seriously impeded. (Location 97)

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What is more, the legendary trader Jesse Livermore, a pioneer of momentum trading, was the inspiration and mental tutor of the Turtle Traders and many other highly successful momentum traders (Location 112)

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BEATING THE MARKET is not easy. notwithstanding this, Table 1 showed that some people have managed to beat the market over the long term by a significant margin. (Location 232)

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People – men in particular – tend to have too much confidence in their own abilities. A nice example is that the vast majority of people believe that their driving skills are above average (which of course cannot be true). (Location 327)

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According to research, a financial loss is about two to two and a half times as painful as an equivalent gain is enjoyable. (Location 340)

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“There is nothing new on Wall Street or in stock speculation. What has happened in the past will happen again and again and again. This is because human nature does not change, and it is human emotion that always gets in the way of human intelligence. (Location 454)

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Top investors do not necessarily limit themselves to one particular sub-style, though. (Location 585)

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Top-down investors start out with the economy and then work their way down to industries, sub-sectors, and individual companies that should do well in the anticipated economic scenario. (Location 647)

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Genuine investing is a major challenge that requires hard work, expertise, experience, an appropriate mindset and a high level of mental control. If any of these are absent the investor’s chances of success are rather slim. First of all, to be successful investors must be better at estimating the fair value of companies than the market. (Location 656)

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Last but not least, successful investors can detach themselves emotionally from the market. (Location 666)

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Some people argue that the universe of small caps is more appealing than the large cap space as small caps have more room for growth. (Location 810)

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Notwithstanding, it is true that individual small caps with excellent growth prospects can grow much faster than large caps with bright prospects. (Location 815)

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Since many small caps are ignored by the average market participant, they are more likely to be mispriced. (Location 836)

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As opposed to ignored stocks, such stocks are usually well-known due to an avalanche of bad news and bad publicity. (Location 869)

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First, one has to identify stocks that are likely to turn around. In other words, one has to look for stocks that are out of favour for the wrong reasons. (Location 877)

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corporate culture.32 •   Buying baskets: one can also, like Jim Rogers, buy a basket of different stocks in an industry that is going through a deep crisis. (Location 922)

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Good businesses: it is best to avoid businesses of poor quality. The best investments are companies with inherent strengths (e.g., strong brand names, leadership in market niches, (Location 997)

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investors typically gravitate towards a number of high-profile beneficiaries of this trend or evolution. Hence, it is unlikely bargains will be found among those stocks. (Location 1109)

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Sometimes the market fails to recognise (or ignores) long-term secular trends because investors are too preoccupied by the short term. (Location 1156)

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According to hedge fund market star Tom Claugus, new revenue sources that are still a few years away are often not discounted into a company’s stock price. (Location 1172)

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Jim Rogers warns against companies in industries that are popular and where professionals are highly paid – in particular when these professionals are business school graduates. (Location 1465)

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The industry shows high growth: companies in high-growth industries are often the market’s darlings. Many top stock pickers are not enthused about high-growth industries and warn that it is wrong to pay handsomely in advance for high growth. (Location 1469)

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Apart from Buffett, numerous other top investors have racked up impressive investment returns by incorporating qualitative business elements in their due diligence. (Location 2319)

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Warren Buffett and Peter Lynch embrace (Location 2415)

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investment advisors, market gurus (Location 5829)

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