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#49 Reflections on Investing : Value Investing and Momentum
One of the most difficult problems for fundamental value investors is reconcliling value and momemtum. Welcome back to Reflections on Investing with the Cornell Capital Group.As we sit here now, the...
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#50 Reflections on Investing : Buy The Dips?
Is a large daily drop in the market a buying opportunity? We used 60 years of daily data to see what happens after the market drops. Hello and welcome back to Reflections on Investing with the Cornell...
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#51 Reflections on Investing : The Apple Stock Bond Paradox
In August of 2020 Apple issued a 40 year, 2.55% bond, two years later that bond is down nearly 40%. Apple's stock on the other hand is up over 50% in that same period. Why is that and what does it...
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Investor Memo Q3 2023: Risk Premiums, Where Art Though?
Discount rate variation (equivalently expected returns, risk premiums) is now at the center of asset pricing questions, from bubbles to the nature of the crash.----- John Cochrane, Presidential...
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#52 Reflections on Investing : The Crash of the Bond Market
Would you believe, that long-term US Treasury securities, historically considered one of the safest investments, have now dropped more than the stock market did during the great recession of 2008? What...
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#53 Reflections on Investing : Real Interest Rates
Real Interest Rates have an immense impact on the stock market as well as the bond market. Nonetheless, they are widely misunderstood. Hello and welcome back to Reflections on Investing with the...
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Investor Memo Q4 2023: Risk Premiums, Where Art Though (Still)?
A market crash is nothing more than a low risk premium meeting risk aversion.----- John P. Hussman, Ph.D., November 8, 2021, When Bubble Meets TroubleRisk Premiums and Stock Prices In our...
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#54 Reflections on Investing : Damodaran’s ERP and Future Stock Returns
The decade ending in 2023 was a great one for common stocks. Is the next decade likely to be as good? We provide an analysis using Damodaran's equity risk premium (ERP) and a framework developed by...
View Article#55 Reflections on Investing : Stock Prices – For Every Buyer There is a Seller
When attempting to explain movements in stock prices the media often overlook the key facts that for every buyer there is a seller and every outstanding share must be held continuously. As we record...
View Article#56 Reflections on Investing : The Medallion Fund vs Market Efficiency
Professor and Nobel Prize winner Eugene Fama put forth the efficient market hypothesis and based on that concept Warren Buffet suggested that holding a passive investment in the S&P 500 was the...
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Investor Memo Q1 2024: The Market Throws Caution to the Wind
The S&P 500 ended the year 2023 at 4,769. During December, several leading financial firms were asked for their forecasts for the year-end 2024. The results are shown below. The most optimistic...
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Structural Change and Valuation: Implications for Future Stock Returns
Download PDF With stock prices at near record highs relative to measures like earnings or cash flow, many leading analysts have predicted meager returns over the next decade. Some have even suggested...
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#57 Reflections on Investing : Risk and Return Revisited
A common refrain is that to get more return you have to bear more risk. But what exactly is risk? We revisit this important issue. As part of the work leading to his Noble Prize, William Sharpe noted...
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Investor Memo Q2 2024: How Long Can This Go On?
The performance of the market was remarkable in the second quarter. Driven by the Magnificent 7 tech stocks, for which the total return was 16.5%, the total return for the S&P 500 was 4.3%. What...
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Tesla’s Valuation Fountain of Youth
Download PDF Aswath Damodaran writes about what he calls the corporate life cycle.[1] He illustrates the life cycle with the graphic as shown below. From a valuation perspective, Damodaran’s corporate...
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Brief Update on The Recent Market Decline
“Well, the market did continue to charge forward and the cost to us was underperformance. Even though our returns were solidly positive, they did not match the performance of the S&P 500. Does that...
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#58 Reflections on Investing : Earnings, the Engine of the Stock Market
The ultimate source of value for common stocks is the earnings of corporations. In the last four and a half years the S&P 500 has risen 124%. How is that increase related to earnings and what does...
View Article#59 Reflections on Investing : From Earnings to Prices – P/E Mulitples
The combination of P/E multiples and earnings determines stock prices – its basic math. In our last episode of Reflections on Investing we looked at earnings, now we add in the role of the multiple....
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Investor Memo Q3 2024: Walking the Tightrope
Stock Price Performance in ReviewWe begin our Q3 2024 memo with a look back over the last ten years. The chart below plots both the standard S&P 500 index, which is value-weighted, and the equal...
View Article#60 Reflections on Investing : Cornell/Damodaran – The Equity Risk Premium
For more than four decades both Prof. Aswath Damodaran and Prof. Bradford Cornell have stressed the importance of the equity risk premium (ERP) for evaluating the stock market. This video dives into...
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