Love stocks? Want to go with the highest stock allocation that makes sense for someone in your circumstances? You need to look into valuation-based market timing. It’s the stock investing strategy for those who truly love stocks. The idea behind valuation-based market timing The Buy-and-Holders don’t see it that way.… Continue reading Practicing Valuation-Based Market Timing Permits an Investor to Go With Higher Stock Allocations

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I believe that all stock investors should want to see the market get the price right at all times. To me it’s an obvious point. We plan our financial futures according to the size of our stock portfolio. If the market gets the price wrong, we cannot count on the… Continue reading Getting the Stock Price Wrong Is Never a Positive, It’s Always a Big Negative

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For a long time, people who write about stock investing have maintained that there are two approaches to examining the market. One is fundamental analysis. That is looking at the economic realities. For stocks to produce gains, the underlying companies need to generate profits. The other is technical analysis. Investors… Continue reading Only a Combination of Fundamental and Technical Analysis Makes Complete Sense

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Robert Shiller’s Nobel-prize-winning research showing that valuations affect long-term returns changed our understanding of how stock investing works in a fundamental way. It has taken a long time for most of us to get our heads around the far-reaching implications of this amazing research. Not all stocks gains are a… Continue reading Recognizing that Some Stock Gains Are a Negative Requires a Big Psychological Shift

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Bull markets don’t just happen. It takes a lot of work to persuade stock investors that it’s okay to go along with the craziness that it takes to support a bull market. That’s not the conventional view. The Buy-and-Hold idea is that bull markets are justified by the economic realities.… Continue reading Bull Markets Are Hard to Pull Off

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I believe that stock investors should aim to be as rational as possible. I believe that the big risk of stock investing is becoming emotional about it. The aim of investment professionals should be to help people rein in their emotions and make rational choices. That’s what Buy-and-Hold is all… Continue reading The Paradoxes of Investor Emotion

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I am a big-time advocate of valuation-based market timing. In a world in which valuations affect long-term timing (the world we live in, according to Robert Shiller’s Nobel-prize-winning research), valuation-based market timing is critical. It is the means by which investors rein in irrational exuberance before it gets out of… Continue reading Is Valuation-Based Market Timing Really Market Timing?

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I put a post to a Motley Fool discussion board at 9 A.M. on the morning of May 13, 2002. It argued that, given Robert Shiller’s Nobel-prize-winning research (he hadn’t yet been awarded a Nobel prize at the time) showing that valuations affect long-term returns, it is a logical impossibility… Continue reading The Arc of History in Stock Investing Bends Toward Rationality

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Irrational exuberance is a strange phenomenon. That word “irrational” is disturbing. Shiller was writing about stock investing in his book. The suggestion that you get just from reading the title of the book, let alone its words and pages and chapters, is that investors are committing self-harm by giving in… Continue reading We Know Little About How Irrational Exuberance Works

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Valuation-Informed Indexing is Buy-and-Hold with Valuation-based market timing added to the mix. Valuation-Informed Indexers don’t go with the same stock allocation at all times, as Buy-and-Holders do. We go with higher stock allocations when stock valuations are low and with lower stock allocations when stock valuations are high. This permits… Continue reading There Is Both Huge Support for and Huge Opposition to Valuation-Based Market Timing

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