For the next dozen years or so, the U.S. stock market will be a wild roller-coaster ride—setting all-time highs and multi-year lows in the process. While the twists and turns of this ride are still to be written by history, the long-term, sideways “range-bound” trajectory has already been set by the eighteen-year bull market that ended in 2000.
When the dust settles, only those who adapted their investment strategies to this range-bound market will have captured any meaningful profits. This is how I started my book Active Value Investing: Making Money in Range-Bound Markets (Wiley, 2007). The following presentation/speech answers the question: Are we there yet? Is the Range-Bound Market Over? (okay, two questions)
Here is a link to the presentation/speech of my book. This presentation/speech almost qualifies as a second (free) edition of the first part of my book – the part that explains why we are likely suffering through a range-bound market. I updated the data; found a better way to explain old and new topics; changed my mind on some things; and answered questions that have been raised by readers. I have to warn you this PDF is 20 pages long. However, a lot of space is consumed by charts and tables thus don’t let the size scare you. Kill some trees, don’t kill your eyes – print it.
I hope you enjoy this and more importantly find it beneficial. You are welcome to share it with your friends (and enemies).
Vitaliy N. Katsenelson, CFA, is a portfolio manager/director of research at Investment Management Associates in Denver, Colo., and he teaches a graduate investment class at the University of Colorado at Denver. He is the author of "Active Value Investing: Making Money in Range-Bound Markets" (Wiley 2007). To receive Vitaliy's future articles my email, click here.