tag:blogger.com,1999:blog-7905515.post8835802137137975776..comments2024-03-14T11:09:32.759-05:00Comments on Falkenblog: Ira Sohn Conference ResultsEric Falkensteinhttp://www.blogger.com/profile/07243687157322033496noreply@blogger.comBlogger4125tag:blogger.com,1999:blog-7905515.post-42531928821175056382012-05-18T13:09:32.123-05:002012-05-18T13:09:32.123-05:00Smart investment advice must always identify who i...Smart investment advice must always identify who is the dumb money on the other side of the trade and also explain why the dumb money is dumb. Did Chanos explain who the dumb money was that was long FSLR and why this dumb money was long FSLR? If not, then Chanos either held back some information (possibly inadvertently) or he just got lucky shorting FSLR. <br /><br />Here some good advice from FrankR that does identify dumb money that can be traded against. AFTER the market indices (Dow, SP500) have gone up, the small fry get interested in buying stocks, and conversely they get interested in selling AFTER the market has gone down (like right about now). The small fry invests like this consistently, for complex psychological reasons. It is possible to gain alpha by simply systematically taking the other side of the dumb money buy high/sell-low trade. How much alpha? John Bogle has been pontificating lately about "69 percentage points" lost by retail investors because they didn't invest passively (I'm not sure of the time frame or other details of this 69 percentage points). Well, that's 69 percentage points that someone else gained (less bid-ask spreads, brokerage commissions and market impacts, all of which should be negligible for someone trading SPY).frhttps://www.blogger.com/profile/14980384436598923074noreply@blogger.comtag:blogger.com,1999:blog-7905515.post-28154088973744255092012-05-18T12:51:14.788-05:002012-05-18T12:51:14.788-05:00So, all one has to do is
a) Invite the "rig...So, all one has to do is <br /><br />a) Invite the "right" managers to the conference, then,<br /><br />b) Discern the "right" picks from their already supposedly wonderful set of picks<br /><br />c) Take huge idiosyncratic risk betting on these "right" picks<br /><br />Simple! Active managment is easy!Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-7905515.post-43182017492181352522012-05-18T08:30:00.981-05:002012-05-18T08:30:00.981-05:00true, but currently I think too many don't ind...true, but currently I think too many don't index passively. If it gets to 99% ETFs, clearly that would be an insane market.Eric Falkensteinhttps://www.blogger.com/profile/07243687157322033496noreply@blogger.comtag:blogger.com,1999:blog-7905515.post-15804168598536603152012-05-18T08:23:24.618-05:002012-05-18T08:23:24.618-05:00One thing though that is always in head is that if...One thing though that is always in head is that if everyone did passive index investing the market would loose its mind.JWOhttps://www.blogger.com/profile/00004178958481335795noreply@blogger.com