On Jan 6, 4:01 pm, Igor Chudov <ichu...[at]algebra.com> wrote:
- quote -

of severe market stress, it just doesn't work.”

Did Stein think his stock portfolio would only rise, through short and
long terms? Buy-and-hold has always meant for the long term.
Witnessing the 1970s, for one, an investor should bear in mind this
may mean more than 10 years. Plus writing these things at an apparent
market low is the sign of one who bends with the market wind. This is
also not a characteristic of a true buy-and-holder.

I would like to see the context of his claim about Graham. Graham has
always advocated bonds as a part of one's portfolio. For a defensive
investor he specifically advocates a split between high grade bonds
and stocks of around 50-50, never falling above 75% nor below 25% for
either category. During a bull market, he wrote the portfolio should
be re-balanced as needed, selling some stocks and buying more bonds.
During a bear market, vice versa.

To me, Graham advocates betting on the economy as a whole via stocks
and bonds. This means betting that demand for better products will
continue; that society's health and well-being will mostly rise over
time as a result of these products; that stocks generally over the
long term must inevitably reflect inflation; and so on. These are the
only rational reasons for owning stocks; any other reasoning denotes a
gambling mentality, AFAIC.

We've all seen this video by now, right?

http://www.youtube.com/watch?v=RYX1AgEV0vo

"Igor Chudov" <ichudov[at]algebra.com> wrote in message
news:ZI-dnf1RKZUlf_7UnZ2dnUVZ_hudnZ2d[at]giganews.com...
- quote -

"Should", like "always" and "never", is a word best left out of advice to
those one doesn't know, just like one would leave those words out in
arguments with one's spouse.

Elizabeth Richardson

On Jan 6, 3:01*pm, Igor Chudov <ichu...[at]algebra.com> wrote:
- quote -


Ben Stein was a speech writer for Nixon. How did he transform himself
into a financial guru?

http://moneynews.newsmax.com/streett...05/167839.html

Apparently, this financial guru thought that buy and hold was just the
thing when everything looked so good and prices were rising.

Now that the prices fell, at some point almost two times below what
this guru was paying for his buys, he realized that buy and hold was "a
thing of the past" and he should cash out from whatever he was holding
and be in cash at least 50%.

Then this guru refers for support to Ben Graham, of all people,
because Ben Graham "concluded near the end of his life that stocks
were simply too risky". (Ben Graham died in 1976, so I would like to
know when exactly he concluded that stocks were too risky, as he
possibly was right for his time).

But the article gets better. It then cites another guru, who says that
an investor should own "from 3 to 11" low cost index funds.

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