Poll: Investor Inkblot Test

[wabmester]

Edit: image borrowed from Dimson's latest report on global returns: pdf link

 

[ziggy29]

Actually, what I see is reversion to the mean.

 

[dusk_to_dawn]

Actually, what I see is reversion to the mean.

Ditto.

 

[brewer12345]

I see someone with too much time on their hands...

 

[bssc]

Actually, what I see is reversion to the mean.

Me too.

 

[haha]

I see that it takes >30 years to get the bottom of the lowest decile above the TIPs guaranteed return.

Ha

 

[wabmester]

I see that it takes >30 years to get the bottom of the lowest decile above the TIPs guaranteed return.

It's actually more like 40 years, but who's counting?

That was the first thing I looked at, which makes me a bear I think. But the long-term downside risk is small, and I think this chart makes a great case for going with 100% stocks during accumulation.

Interesting tidbits from the report: forward-looking risk premium is estimated at 3-3.5%; VIX is at an all-time low, so portfolio protection is cheap, but back-testing portfolio protection didn't look too good.

BTW, the picture is of UK return dispersion.

 

[TromboneAl]

A penis.

 

[ziggy29]

A penis.

Sometimes, a cigar is just a cigar.

 

[maddythebeagle]

A penis.

if that is what you think one is suppose to look like, than mrs. T-Al, must be really sore...

 

[Martha]

if that is what you think one is suppose to look like, than mrs. T-Al, must be really sore...

 

[haha]

Somewhat akin to a boar's. I'd borrow one to try for a few weekends if it were possible. Some curious lady would likely assent.

Ha

 

[Martha]

Somewhat akin to a boar's. I'd borrow one to try for a few weekends if it were possible. Some curious lady would likely assent.

Ha

You made me google boar's penis.

I need to get up off this couch!

 

[Gone4Good]

I see that it takes >30 years to get the bottom of the lowest decile above the TIPs guaranteed return.

Ha

You could also say ~99% of the time your equity returns will be better then TIPs over 30 years.

It looks like the top of the bottom quartile crosses somewhere around 2% after 10-years. So you could also say that 75% of the time equities do better than TIPs after 10-years.

 

[haha]

You could also say ~99% of the time your equity returns will be better then TIPs over 30 years.

It looks like the top of the bottom quartile crosses somewhere around 2% after 10-years. So you could also say that 75% of the time equities do better than TIPs after 10-years.

You are right; that's why it is a Rorschach Test.

Ha