Comments on: Book Review: Active Value Investing

By: Useful Used Car Pricing Resources | MoneySense

Useful Used Car Pricing Resources | MoneySense — Mon, 08 Nov 2010 19:44:47 +0000

[...] Book Review: Active Value Investing [...]

By: active value investing — award tour

active value investing — award tour — Thu, 18 Oct 2007 16:00:52 +0000

[...] Book Review: Active Value Investing. book claims that equity markets will remain “range bound” for the next decade. and a follow-up post on passive investing in a range-bound market. [...]

By: Passive Investing in a Range-Bound Market

Passive Investing in a Range-Bound Market — Mon, 15 Oct 2007 23:31:52 +0000

[...] Contact ← Book Review: Active Value Investing [...]

By: Canadian Capitalist

Canadian Capitalist — Mon, 15 Oct 2007 18:23:10 +0000

Jon: No, taxes are not addressed. I’m guessing that the author would contend that paying taxes ain’t so bad considering that capital gains from passive investing is close to 0% and most of the gains come from dividends. Still, I am not willing to give up on passive investing because I’m not sure average investors can successfully beat the markets.

pessimist: Vitaliy suggests investors look into foreign stocks but to stay within the developed markets. You’re right about fixed income investing in taxable accounts may not be very appealing.

Tomorrow’s post “Passive Investing in Range-Bound Markets” tackles some of the points raised in your two comments.

By: pessimist

pessimist — Mon, 15 Oct 2007 16:45:47 +0000

I’m wondering about putting money in GICs, even assuming range bound markets. After the tax we pay in Canada on income, how badly would the market have to do to make GICs palatable?

Also, does he discuss emerging markets at all? I have a hard time believing they’re going to be range bound.

By: Jon D.

Jon D. — Mon, 15 Oct 2007 14:24:52 +0000

Does the author quantify what “satisfactory returns” are? Ie, average returns, 5 or 10 year CAGR returns?

Anytime I hear “active” I think of tax implications for non-sheltered investors. Is this addressed at all in the book?

By: Canadian Capitalist

Canadian Capitalist — Mon, 15 Oct 2007 13:24:50 +0000

Alex: I owned around 20 individual stocks and I was finding that I was barely beating the markets before taxes and it was sucking up a lot of my time. So, I questioned myself if picking stocks for the entire equity portion was worth my time. I still love to pick stocks but I restrict myself to the Canadian equity portion.

Phil: Vitaliy points out that in range-bound markets most of the returns are in the form of dividends. The book mostly talks about the U.S. equity market, but he does note that the market will yo-yo but remain range bound.

By: Phil S

Phil S — Mon, 15 Oct 2007 11:57:48 +0000

If the broader market truly does remain range bound as this author seems to suggest – then the simple answer is to invest for yield on investments that pay some kind of a distribution.

I personally don’t agree with that basic premise, however. I think the TSX is overbought and earnings growth expectations are too high. At the first hint of any disappointing economic or earnings news, the TSX will take it on the chin. Hence, all my “new” money is going into cashable GICs for now. In case I’m wrong, I haven’t sold any of my existing equities, though.

By: Alex

Alex — Mon, 15 Oct 2007 07:07:33 +0000

I just have a question, why did you move to ETF from owning individual stocks?