We heard that buy and hold is a looser's strategy so many times before, here and here, that it's not sure the new report by Deutsche Bank will convince any more people. DB's long-term asset study shows that:
Over the last 50 years, the real returns from equities have been lower than those from bonds in Germany, Japan and Italy. In the Italian case, the gap is almost three percentage points, and that is despite the recent bond sell-off.
The U.S. case, which inspired all investor's wannabe is an historical anomaly.Now, is owning stocks for a millisecond capital allocation ? My take is that this shift from long-term to short-term reflects a shift from capital allocation to risk allocation, which is what Krugman meant by "from boring banking to fancy finance".
No comments:
Post a Comment