The Graham/Dodd Approach to Investing and Micro-Cap Stocks: A Winning Combination
Many market analysts argue over the “efficiency” of markets. Efficient market proponents believe that markets are rational and discount all relevant data, news and financial information into prices. This makes it difficult, if not impossible, for a sophisticated active manager to outperform indexes. This theory of market pricing has taken a severe hit over the last twelve years as a result of the bursting of the Nasdaq and housing bubbles. In retrospect, it is now obvious that these markets were severely overpriced and slated to provide very poor forward looking returns at the peak of the bubble.
For the entire article, please download the file below.