111–120 of 163 posts
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go on morningstar (or below) and look at the chart for the entire life of the fund, you'll see that he had periods of massive outperformance http://quotes.morningstar.com/chart/fund/chart?t=HSGFX®io...
It's probably a stupid question, but doesn't that ignore the dividends?
This guy expects a market loss of about -65%, which would send the S&P 500 back down to 900. He also expects negative total returns over the next 12 years. Of course, his Strategic Growth Fund has not only underperformed its benchmark (the S&P 500 index), the fund actually has negative returns over the past 1, 3, 5, and 10 year periods[1]. Losing money in this market is a truly remarkable feat. [1]: https://www.hussm…
Which is very possible. Or how did Mandelbrot say? "speculating on the stock market is riskier than you think"
The current highs are only possible because interest is so low and people leverage. A 2% return is no problem. Leverage times 3 and you have a decent 6%. But what happens, if interest rates rise and you get margin calls? Your have to sell. Wait, the others have to sell too....
"He also expects negative total returns over the next 12 years."
Past performances are no guarantee for future performances works both ways.
"Losing money in this market is a truly remarkable feat."
Not necessarily. Timing is tricky. The market can stay longer irrational as you can stay liquid.
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Isn't it a complexity optimization? In the broader system there is no coordination of attempts so multiple nodes 'waste' resources trying the same invalid solutions if I understand correctly.
Yes, but the number of possible "solutions" (valid or invalid) is so large that it's extremely unlikely that 2 people are getting the same invalid solutions (assuming the software is working correctly). so you don't need any coordination. And "extremely unlikely" doesn't quite get across the magnitude here. We are talking about the likelihood of 2 people generating the same SHA256 hash of what is basically an absurdl…
The economy is just a mechanism to have a predictable environment in which to raise children.
The most striking moment to me in my IPE class was when the professor, after we'd covered how governments and, in democracies (by proxy), We the People, bring modern economies into being and choose, to some degree (other governments and a variety of natural factors have more than a little say), the shape they'll take, innocently asked, "so, why have an economy?" Yours is a better answer than what any of us came up wi…
This guy expects a market loss of about -65%, which would send the S&P 500 back down to 900. He also expects negative total returns over the next 12 years. Of course, his Strategic Growth Fund has not only underperformed its benchmark (the S&P 500 index), the fund actually has negative returns over the past 1, 3, 5, and 10 year periods[1]. Losing money in this market is a truly remarkable feat. [1]: https://www.hussm…
One way to generate uncorrelated returns is by being long (making money when stocks go up) and short (making money when stocks go down) -- you are effectively trying to make money on the spread between your buys and sells.
In bullish markets, being short can hurt -- a lot. Hence you end up with negative returns (Your shorts did a lot worse, than your longs did good).
Hussman's funds satisfy a need in the marketplace for uncorrelated funds -- he did really well in the dot com bust and the years after that, but has really lagged behind not just the market but other peer market neutral funds which should be the true yardstick to measure his success.
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Yes, but the number of possible "solutions" (valid or invalid) is so large that it's extremely unlikely that 2 people are getting the same invalid solutions (assuming the software is working correctly). so you don't need any coordination. And "extremely unlikely" doesn't quite get across the magnitude here. We are talking about the likelihood of 2 people generating the same SHA256 hash of what is basically an absurdl…
Difficulty can't actually correspond to the number of leading zeros required in the hash, can it? Then there would only be 256 levels of difficulty, and the average block time would have to double whenever difficulty increases. Yet I see this "leading zeros" explanation everywhere. So maybe it is the case, but if so, why was this way chosen rather than just requiring that the hash be less than some value, with that v…
The reality is closer to what you say at the end there, it is calculated so that the resulting hash must be under a given value, and is pretty damn granular. Sadly many people trip over the idea of one hash being "less" than another, and it's just easier to go with the "number of zeros" explanation rather than spend time explaining how a hash just represents a bigass number.
For example, the current difficulty as of this comment is 1873105475221.611
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I think these funds are useful as a risk hedge — there is some non-zero risk every year that the economy will collapse. If you invest in a fund that will help offset some of that risk by performing above average in a downturn, you might want to do it as part of a portfolio strategy. Nobody should be putting their life savings into one of these. Hedge funds like this aren’t for that; they’re a risk management lever th…
lots of people here keep using the term "hedge"...none of the permabears market these as hedge funds...they do not internally hedge their own risk positions these are what they appear to be - bear market funds
The opposite is the case now. Every other armchair investor (and their ivory tower counterparts) is calling bubble now: on Bitcoin; on stocks; on bonds.
Here's how to identify a real bubble. The conventional wisdom says go all in on a single asset. If you don't, you will get rekt. The only people who disagree with this position are cranks.
That's a bubble. It happened in 1999 with stocks and it happened in 2007 with real estate.
No asset is in a bubble at the moment based on this definition because the conventional wisdom is against all of them.
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Compared to what?
Almost anything? Even the market's most ardent defenders would not claim it is a system of constant predictability. If it were predictable investing would be a lot easier.
In my European country, even less than a century ago, it was unpredictable for large swaths of the population whether they'd have enough to eat to survive next year. That's not true for the vast majority nowadays.