02-05-2022, 07:24 AM
This is research work that shows the correlation of stock price/integrated equity and subsequent 10yr inflation adjusted returns.
Basically it tells you this very simple thing when you buy stocks when price is high your returns in next 10yrs is low.
If you buy US stocks now your future returns is negative
You need to patiently wait for stock prices to fall further then you can get positive returns when you buy.
Basically those firing money into US markets now may be doing it too early.
Not the chart is for long term average 10 yr returns. Yr by Yr.it may deviate in short term. It can only be used for long term..
The long term correlation is 0.92
![[Image: QAzDgRr.jpg]](https://i.imgur.com/QAzDgRr.jpg)
The detailed research for this can be found below.
If you have time you can go through the stats and the integrated equity calculation.
https://osam.com/Commentary/the-earnings-mirage
I did the computation for 3 markets Singapore, Japan and Israel. The expected returns are positive in these markets.
I believe it is positive for Malaysia also.
Basically it tells you this very simple thing when you buy stocks when price is high your returns in next 10yrs is low.
If you buy US stocks now your future returns is negative
You need to patiently wait for stock prices to fall further then you can get positive returns when you buy.
Basically those firing money into US markets now may be doing it too early.
Not the chart is for long term average 10 yr returns. Yr by Yr.it may deviate in short term. It can only be used for long term..
The long term correlation is 0.92
![[Image: QAzDgRr.jpg]](https://i.imgur.com/QAzDgRr.jpg)
The detailed research for this can be found below.
If you have time you can go through the stats and the integrated equity calculation.
https://osam.com/Commentary/the-earnings-mirage
I did the computation for 3 markets Singapore, Japan and Israel. The expected returns are positive in these markets.
I believe it is positive for Malaysia also.
I, being poor, have only my dreams; I have spread my dreams under your feet; Tread softly because you tread on my dreams.