Comments on: Why Long Term Investors Should Consider Buying http://www.tradersnarrative.com/why-long-term-investors-should-consider-buying-2099.html Freshly squeezed market commentary & analysis Sat, 20 Mar 2010 07:59:33 +0000 http://wordpress.org/?v=2.0.2 by: La semana en los mercados (4 - 11 Diciembre) >> Euribor http://www.tradersnarrative.com/why-long-term-investors-should-consider-buying-2099.html#comment-35899 Fri, 12 Dec 2008 08:26:12 +0000 http://www.tradersnarrative.com/why-long-term-investors-should-consider-buying-2099.html#comment-35899 [...] En este artículo en inglés pero con un gráfico muy claro intentan demostrar que es buen momento para comprar en bolsa:  [...] […] En este artículo en inglés pero con un gráfico muy claro intentan demostrar que es buen momento para comprar en bolsa:  […]

]]> by: Alex http://www.tradersnarrative.com/why-long-term-investors-should-consider-buying-2099.html#comment-35754 Thu, 27 Nov 2008 23:00:07 +0000 http://www.tradersnarrative.com/why-long-term-investors-should-consider-buying-2099.html#comment-35754 Babak, I just found an <a href="http://www.simplestockinvesting.com/SP500-historical-real-total-returns.htm">interesting graph on - actually two</a>. One compares dividends and inflation since 1950, the other shows the S&#38;P 500 adjusted for dividends and inflation. Babak, I just found an interesting graph on - actually two. One compares dividends and inflation since 1950, the other shows the S&P 500 adjusted for dividends and inflation.

]]> by: Alex http://www.tradersnarrative.com/why-long-term-investors-should-consider-buying-2099.html#comment-35750 Thu, 27 Nov 2008 17:00:07 +0000 http://www.tradersnarrative.com/why-long-term-investors-should-consider-buying-2099.html#comment-35750 Babak, they don't really cancel each other out. Consider a period of deflation, were dividends negative back then? No. And consider periods of high inflation, were dividends as high as the inflation? Again it's a no. The only possible 'yes' is that *in average* they cancel each other out, but you'd have to stay invested for at least 50 years to see that kind of averaging effect. Keep in mind that over many decades people held stocks because of their dividends (as they were higher than the current inflation), and only in the 80s people started holding stocks because of rising stock prices. In other words, the chart above might look completely different when factoring in dividends and inflation. Babak, they don’t really cancel each other out. Consider a period of deflation, were dividends negative back then? No. And consider periods of high inflation, were dividends as high as the inflation? Again it’s a no. The only possible ‘yes’ is that *in average* they cancel each other out, but you’d have to stay invested for at least 50 years to see that kind of averaging effect.

Keep in mind that over many decades people held stocks because of their dividends (as they were higher than the current inflation), and only in the 80s people started holding stocks because of rising stock prices.

In other words, the chart above might look completely different when factoring in dividends and inflation.

]]> by: Babak http://www.tradersnarrative.com/why-long-term-investors-should-consider-buying-2099.html#comment-35747 Thu, 27 Nov 2008 13:21:17 +0000 http://www.tradersnarrative.com/why-long-term-investors-should-consider-buying-2099.html#comment-35747 Michael, I could never make heads or tails of Elliot wave. But I'll take your word for it. Alex, since dividends and inflation are opposing effects, how about we say they cancel each other out? Michael, I could never make heads or tails of Elliot wave. But I’ll take your word for it.

Alex, since dividends and inflation are opposing effects, how about we say they cancel each other out?

]]> by: A Thanksgiving Stock Market Reminder at Emac’s Stock Watch | Fox Business http://www.tradersnarrative.com/why-long-term-investors-should-consider-buying-2099.html#comment-35742 Wed, 26 Nov 2008 20:56:25 +0000 http://www.tradersnarrative.com/why-long-term-investors-should-consider-buying-2099.html#comment-35742 [...] Right now, for November 2008, the rolling 10-year return, before dividends, on the S&#38;P 500 is negative 25.57%, according to one of the best Wall Street websites, Trader&#8217;s Narrative. Not the lowest, but quite low, the site says.  [...] […] Right now, for November 2008, the rolling 10-year return, before dividends, on the S&P 500 is negative 25.57%, according to one of the best Wall Street websites, Trader’s Narrative. Not the lowest, but quite low, the site says.  […]

]]> by: Alex http://www.tradersnarrative.com/why-long-term-investors-should-consider-buying-2099.html#comment-35732 Wed, 26 Nov 2008 00:04:10 +0000 http://www.tradersnarrative.com/why-long-term-investors-should-consider-buying-2099.html#comment-35732 The problem this chart has is that it does not cover inflation and dividends. Right now it's impossible to answer yes or no to questions like "were the rolling returns so high because inflation was high?", "were the returns ex-dividends low because the dividends were high?", "was the negative 10yr return in the 30s lower than the deflation?". Would you consider recreating the chart adding in dividends and factoring out inflation? I'd love to see the result. The problem this chart has is that it does not cover inflation and dividends. Right now it’s impossible to answer yes or no to questions like “were the rolling returns so high because inflation was high?”, “were the returns ex-dividends low because the dividends were high?”, “was the negative 10yr return in the 30s lower than the deflation?”.

Would you consider recreating the chart adding in dividends and factoring out inflation? I’d love to see the result.

]]> by: Tuesday Chatter (11-25-2008) http://www.tradersnarrative.com/why-long-term-investors-should-consider-buying-2099.html#comment-35729 Tue, 25 Nov 2008 20:32:28 +0000 http://www.tradersnarrative.com/why-long-term-investors-should-consider-buying-2099.html#comment-35729 [...] Why Long Term Investors Should Consider Buying [...] […] Why Long Term Investors Should Consider Buying […]

]]> by: Michael Lomker http://www.tradersnarrative.com/why-long-term-investors-should-consider-buying-2099.html#comment-35728 Tue, 25 Nov 2008 16:26:15 +0000 http://www.tradersnarrative.com/why-long-term-investors-should-consider-buying-2099.html#comment-35728 Elliot wave suggests that the final bottom (a year or two from now) will be 500 on the S&#38;P. That is a 61.8% retracement of the entire bull market. If you aren't going to time the market or pick individual stocks (industries that rebound first during recessions) then I'd recommend staying out. This is not the time to buy index funds, imo. Elliot wave suggests that the final bottom (a year or two from now) will be 500 on the S&P. That is a 61.8% retracement of the entire bull market. If you aren’t going to time the market or pick individual stocks (industries that rebound first during recessions) then I’d recommend staying out. This is not the time to buy index funds, imo.

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