Category: Money Tips Date: 2006-05-08
When the two sessions held a few years ago, a high degree of attention to the stock market bubble and insider trading Wu Jinglian once again in the news. Mr. Wu for failing to define the specific criteria for a bubble or not, but still expressed all the people "frying" shares concerns. : "Although the ownership rate in America is much higher than China, but what we see every day Americans to buy their own shares? ... ... We always say 'stocks', 'stocks', for six months or less frequent transactions, called stocks . But in the United States, a lot of stock turnover more than two years, that is a long-term operation. "
Can imagine, his comments may not be every day on the CBBC Bosha between the people and investors who recognized the base. The Shanghai Composite Index doubled in 2006, the real face of Jiduyouhuo moment, who could remain indifferent, and several can talk about long-term operations?
In each one of us selfish genes, the fame and fortune often beat the nerves, greed will always eat sensibly. Finance scientists decades ago convincingly put forward the "efficient market hypothesis", theoretically prove that the opportunities and risks of contrast, the stock market there is no prophet, individuals can not beat the market. But for all of the capital market practitioners for their career Ye Hao, their mission worth mentioning, no not the defeat of this prophecy to prove he is the only exception.
It was also an exception in the exceptions, such as this "long-term" author Charles Ellis, and he has told the story of the protagonist - Capital Group (Capital Group).
Greenwich Partners as the founder and leader of more than 30 years, Ellis is the world's 10 investment management industry, one of Lifetime Contribution Award winner.
Ellis firmly believes that continuous selection of stock is to lose the game. Engaged in all investment in their consultation, he has strongly in favor of investors, according to different needs, preferences and risk tolerance to design an appropriate portfolio of assets, especially through investment funds buy and hold a broad market index that includes stocks. Ellis is a portfolio indexation strong advocate of his frank, institutional investors, of course, another talented perseverance, but in the long run, no one can do better than anyone else to go.
Ellis is the investment the industry believe in the "efficient market hypothesis" exception, he is definitely not a genius analysts and fans star-invested enterprises, and his ideas clearly reflected in their vocabulary frequently cited: combination of indexation and long-term . Because of this, "Walk Down Wall Street" Malkiel, author of the book In a letter to "long-term" in the preamble only then Ellis for capital appreciation group called the "low probability event."
The small probability of occurrence of their own good reasons. The most important point is that as more than 70 years of history, assets, more than one trillion U.S. dollars of investment management giant Capital Group has always put a low-cost index-based investments as their winning strategy and applied successfully. That it's the U.S. mutual fund companies, the U.S. Growth Fund, Inc., Washington Mutual Inc., the U.S. investment companies, etc. are all famous.
The second, more profound background is impetuous and arrogant in this very popular business, finance Group has mature culture to organize their own "knowledge workers." First, the Capital Group's management style is far from Wall Street and near Silicon Valley, the company refused to arrogant star, no employees to work together is not conducive to the level of mark, the pursuit of trust, respect and a pleasant atmosphere and harmonious coexistence. Secondly, the securities management business implementation of the "pluralistic advisory system", which means that each of the subsidiary companies at the same time to a number of portfolio managers, so that each manager is only responsible for all portfolio part of the fund, and systematically eliminated Investment star monopoly status, and effective solution to the asset size of the expansion and managers flexibility of contradictions. Finally, in the Internet bubble, real estate bubble, a commodity futures investment style heat the changing face of the massive capital groups, "how are you going to change," made the issue a "not ready to change" answer.
"Long-term," tells of a long U.S. capital markets, the ups and legend. 70 years of history, is close to today's average life span of human life is more like a marathon, not a hurdle to complete within ten seconds. In this agitation the years, who can beat the market, who can lay down long-term, future proof their own.
