Value Averaging - The Safe and Easy Strategy for Higher Investment Returns

Informationen zum Autor MICHAEL E. EDLESON is a Managing Director of Morgan Stanley and oversees the firm's equity risk globally. Prior to that, he was Chief Economist of NASDAQ and a finance professor at Harvard Business School. Edleson earned his PhD at MIT. Includes spreadsheets on a companion Web site: www.wiley.com/go/valueaveraging Klappentext Praise for Value Averaging"Dollar cost averaging is making a comeback, and Mike Edleson's value averaging approach is dollar cost averaging on steroids. A must-read for serious investors willing to adhere to the principles found in these pages."--William G. Christie, Frances Hampton Currey Professor of Finance and Professor of Law, Owen Graduate School of Management, Vanderbilt University"Dr. Edleson's book is truly a classic that needs to be perpetuated. I have spent a significant chunk of my career trying to debunk value averaging, but with no success. I'm a believer!"--Paul S. Marshall, PhD, Professor of Finance, Widener UniversityFrom the First Edition"Today's best way to invest."--Money magazine"Value averaging takes dollar cost averaging one step further. Besides buying low, you sell shares when the markets soar."--The New York TimesMichael Edleson first introduced his concept of value averaging to the world in an article written in 1988. To satisfy investor interest, he wrote a book entitled Value Averaging, which further detailed this method. Following the publication of the last edition of this highly sought-after book in 1993, it has been nearly impossible to find--until now. With the reintroduction of Value Averaging, you now have access to Edleson's original work on a strategy that can help you accumulate wealth, increase your investment returns, and achieve your financial goals. Zusammenfassung Michael Edleson first introduced the concept of value averaging in a 1988 paper, and soon after wrote a book on the concept while he was a finance professor at the Harvard Business School. His book--which today is hard to find, but in high demand--is now regarded by many in the investment community as a true investment classic. Inhaltsverzeichnis Foreword by William J. Bernstein ix Preface to the 2006 Edition xiii Preface to the 1993 Edition xix Introduction 1 1 Market Risk, Timing, and Formula Strategies 3 Risk and Market Returns 3 Market Returns over Time 3 Distribution of Market Returns 9 Risk and Expected Return 13 Market Timing and Formula Strategies 20 Timing the Market 20 Automatic Timing with Formula Strategies 21 Endnotes 23 2006 Note 24 2 Dollar Cost Averaging Revisited 25 Dollar Cost Averaging: An Example 26 Short-term Performance 28 Over One-Year Periods 30 Over Five-Year Periods 32 Long-term Problems with Dollar Cost Averaging 34 Growth Equalization 35 Summary 36 Endnotes 37 3 Value Averaging 39 Value Averaging: An Introduction 39 Short-term Performance 43 Long-term Performance and Value Averaging 47 Linear, or Fixed-Dollar, Strategies 47 Adjusting Strategies for Growth 51 Summary 53 Endnotes 54 2006 Notes 55 4 Investment Goals with Dollar Cost Averaging 57 Background 57 Lump-Sum Investments 57 Using the Formula 59 Annuities: Periodic Investments 60 Dollar Cost Averaging and Annuities 63 Readjusting the Investment Plan 63 The Readjustment Process 64 Flexibility 66 Down-Shifting Investment Risk 69 Growth-adjusted Dollar Cost Averaging 71 Exact Formula 72 Approximate Formula 74 Readjusting the DCA Plan 75 Summary 80 Endnotes 80 Appendix to Chapter 4: Constructing a DCA Readjustment Spreadsheet 83 5 Establishing the ...

List of contents

Foreword by William J. Bernstein.
 
Preface to the 2006 Edition.
 
Preface to the 1993 Edition.
 
Introduction.
 
1 Market Risk, Timing, and Formula Strategies.
 
RISK AND MARKET RETURNS.
 
Market Returns over Time.
 
Distribution of Market Returns.
 
Risk and Expected Return.
 
MARKET TIMING AND FORMULA STRATEGIES.
 
Timing the Market.
 
Automatic Timing with Formula Strategies.
 
ENDNOTES.
 
2006 NOTE.
 
2 Dollar Cost Averaging Revisited.
 
DOLLAR COST AVERAGING: AN EXAMPLE.
 
SHORT-TERM PERFORMANCE.
 
Over One-Year Periods.
 
Over Five-Year Periods.
 
LONG-TERM PROBLEMS WITH DOLLAR COST AVERAGING.
 
Growth Equalization.
 
SUMMARY.
 
ENDNOTES.
 
3 Value Averaging.
 
VALUE AVERAGING: AN INTRODUCTION.
 
SHORT-TERM PERFORMANCE.
 
LONG-TERM PERFORMANCE AND VALUE AVERAGING.
 
Linear, or Fixed-Dollar, Strategies.
 
Adjusting Strategies for Growth.
 
SUMMARY.
 
ENDNOTES.
 
2006 NOTES.
 
4 Investment Goals with Dollar Cost Averaging.
 
BACKGROUND.
 
Lump-Sum Investments.
 
Using the Formula.
 
Annuities: Periodic Investments.
 
Dollar Cost Averaging and Annuities.
 
READJUSTING THE INVESTMENT PLAN.
 
The Readjustment Process.
 
Flexibility.
 
Down-Shifting Investment Risk.
 
GROWTH-ADJUSTED DOLLAR COST AVERAGING.
 
Exact Formula.
 
Approximate Formula.
 
Readjusting the DCA Plan.
 
SUMMARY.
 
ENDNOTES.
 
Appendix to Chapter 4: Constructing a DCA Readjustment Spreadsheet.
 
5 Establishing the Value Path.
 
VALUE AVERAGING VALUE PATHS.
 
The Value Path Formula.
 
Flexible Variations on the Value Path Formula.
 
Readjusting the VA Plan.
 
A Cautionary Note.
 
An Alternate Method.
 
SUMMARY.
 
ENDNOTES.
 
Appendix to Chapter 5: Constructing a VA Readjustment Spreadsheet.
 
6 Avoiding Taxes and Transaction Costs.
 
TAX CONSIDERATIONS WITH VALUE AVERAGING.
 
The Advantage of Deferred Gains.
 
Deferring Capital Gains Taxes: An Example.
 
A Compromise: No-Sell Value Averaging.
 
REDUCING TRANSACTION COSTS.
 
Limiting Taxes.
 
Limiting Costs.
 
SUMMARY.
 
ENDNOTES.
 
7 Playing Simulation Games.
 
WHY SIMULATIONS?
 
WHAT AND HOW?
 
Parameters.
 
Expected Return.
 
Expected Variability.
 
Randomness.
 
CONSTRUCTING THE SIMULATION.
 
An Example.
 
ENDNOTES.
 
Appendix to Chapter 7: Constructing a Simulation.
 
2006 NOTE.
 
ENDNOTES TO APPENDIX TO CHAPTER 7.
 
2006 NOTE.
 
8 Comparing the Strategies.
 
FIVE-YEAR SIMULATION RESULTS.
 
Using Growth Adjustments.
 
No-Sell Variation.
 
Volatility.
 
TWENTY-YEAR SIMULATION RESULTS.
 
SUMMARY.
 
ENDNOTES.
 
9 Profiting from Overreaction.
 
TIRING OF A RANDOM WALK.
 
Mean Reversion and Overreaction.
 
A Brief Look at the Data.
 
WHY DOES THIS MATTER?
 
Timing.
 
ENDNOTES.
 
2006 NOTE.
 
10 Details: Getting Started.
 
USING MUTUAL FUNDS.
 
The Fund versus Stock Choice.
 
Index Funds.
 
Information on Specific Funds.
 
WORKING OUT THE DETAILS.
 
Using a Side Fund.
&nbs

Product details

• Authors: William J. Bernstein, Michael E Edleson, Michael E. Edleson, Edleson Michael E.
• Assisted by: William J. Bernstein (Foreword), Bernstein William J. (Foreword)
• Publisher: Wiley, John and Sons Ltd
• Languages: English
• Product format: Paperback / Softback
• Released: 13.10.2006
• EAN: 9780470049778
• ISBN: 978-0-470-04977-8
• No. of pages: 256
• Dimensions: 139 mm x 217 mm x 16 mm
• Series: Wiley Investment Classics; Wiley Investment Classic Series; Wiley Investment Classics; Wiley Investment Classic Series
• Subjects: Social sciences, law, business > Business > Business administration; Finance & Investments, Finanz- u. Anlagewesen, Institutionelle Finanzplanung, Institutional & Corporate Finance