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  #161  
Old 13.04.2016, 11:15
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Re: Investment fund

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Why?
Why not?
Maybe you have some better investment ideas, or no money to invest
anyway?
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  #162  
Old 13.04.2016, 15:48
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Re: Investment fund

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His point is that your post is a logical fallacy known as appeal to authority.
Don't think you got the fallacy right, it is like saying.
Darwin who formulated the theory of evolution says we have all evolved.

Then you clain it is appeal to authority.

actually the other argument has a logical fallacy
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Remember Long Term Capital Management? It collapsed in 1998 and in the Board of Directors were Scholes and Merton. Both Nobel price winners.
Here some example of appeal to authority.
Appeal to authority http://www.nizkor.org/features/falla...authority.html

This is probably another survivorship bias, http://topdocumentaryfilms.com/derren-brown-the-system/ after big decline banks, investors close funds and open new ones. So only the ones with some return are marketed or still open.
http://www.wsj.com/articles/SB100008...45460615317218


And yes there are many fund managers with long track record just check the Market Wizards series: https://en.wikipedia.org/wiki/Market_Wizards

I think one of the criteria to be considered top trader/ fund manager was constantly beat market for over 10 years.

Last edited by profetas; 13.04.2016 at 16:00. Reason: Added one interesting link
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  #163  
Old 13.04.2016, 16:42
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Re: Investment fund

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Don't think you got the fallacy right, it is like saying.

Darwin who formulated the theory of evolution says we have all evolved.

Then you clain it is appeal to authority.

actually the other argument has a logical fallacy

Here some example of appeal to authority.
Appeal to authority http://www.nizkor.org/features/falla...authority.html
Err, you seem to be confused by the page you linked. The one making the claim and the authority do not have to be the same persons.

An appeal to authority is exactly what it says on the tin: you assert that because an authority (e.g. Nobel prize winners Fama & French, your boss, your husband, the bible - doesn't matter) supports your claim, the claim must be true. If Capo wrote: "here are some studies by Fama & French that establish a method of determining whether a fund manager is lucky or not" that'd have been fine.

In other words, you try to enhance the weight of your opinion by highlighting the credentials/status of some people who agree with you. Tinkiwinki then replied that just because someone has a Nobel prize, they are not automatically infallible.
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  #164  
Old 13.04.2016, 18:30
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Re: Investment fund

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Err, you seem to be confused by the page you linked. The one making the claim and the authority do not have to be the same persons.

An appeal to authority is exactly what it says on the tin: you assert that because an authority (e.g. Nobel prize winners Fama & French, your boss, your husband, the bible - doesn't matter) supports your claim, the claim must be true. If Capo wrote: "here are some studies by Fama & French that establish a method of determining whether a fund manager is lucky or not" that'd have been fine.

In other words, you try to enhance the weight of your opinion by highlighting the credentials/status of some people who agree with you. Tinkiwinki then replied that just because someone has a Nobel prize, they are not automatically infallible.
Jeez. You have the patience of a saint to explain what should be obvious to any half-intelligent person...
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  #165  
Old 13.04.2016, 22:52
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Re: Investment fund

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In other words, you try to enhance the weight of your opinion by highlighting the credentials/status of some people who agree with you. Tinkiwinki then replied that just because someone has a Nobel prize, they are not automatically infallible.
Nope

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The point is that Nobel laureate, Prof. Eugene Fama, and Prof. Kenneth French have proven that only after a considerable period of time a fund can claim to beat the market.
Anyone that has written scientific papers will understand the quote above.
He gave a short summary of the argument and gave a reference. That is not argument by authority. If that was argument by authority nobody would be able to reference the work of other people.

This is the argument: after a considerable period of time a fund can claim to beat the market. You can remove the reference to the Nobel laureate and the argument is still the same.

Here are examples of citation vs appeal to authority
http://onegoodmove.org/fallacy/aa.htm

Then someone followed with anecdotal evidence fallacy where he found a Nobel laureate that is a bad investor or whatever

And this one from Phil is an ad hominems fallacy and against forum rules.
Quote:
Jeez. You have the patience of a saint to explain what should be obvious to any half-intelligent person...
If you don't have the skills just keep cheerleading, personal attacks won't convince anyone.

The simple way to counter his argument it is to explain how with such short period of time you can evaluate the skill of the fund manager based only on the return? Like my example way back I know some penny stock traders that made huge return but they have no clue of risk management and for the one successful hundreds got bust. Survival bias not skill.

I won't even comment on the Top 5 claim since it is very subjective.
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  #166  
Old 13.04.2016, 23:09
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Re: Investment fund

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Nope


Anyone that has written scientific papers will understand the quote above.
He gave a short summary of the argument and gave a reference. That is not argument by authority. If that was argument by authority nobody would be able to reference the work of other people.

This is the argument: after a considerable period of time a fund can claim to beat the market. You can remove the reference to the Nobel laureate and the argument is still the same.

Here are examples of citation vs appeal to authority
http://onegoodmove.org/fallacy/aa.htm

Then someone followed with anecdotal evidence fallacy where he found a Nobel laureate that is a bad investor or whatever

And this one from Phil is an ad hominems fallacy and against forum rules.

If you don't have the skills just keep cheerleading, personal attacks won't convince anyone.

The simple way to counter his argument it is to explain how with such short period of time you can evaluate the skill of the fund manager based only on the return? Like my example way back I know some penny stock traders that made huge return but they have no clue of risk management and for the one successful hundreds got bust. Survival bias not skill.

I won't even comment on the Top 5 claim since it is very subjective.
Lovely post. That's the kinda stuff I like to see. A systematic dismantling.
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  #167  
Old 13.04.2016, 23:14
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Re: Investment fund

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If you don't have the skills just keep cheerleading, personal attacks won't convince anyone.

The simple way to counter his argument it is to explain how with such short period of time you can evaluate the skill of the fund manager based only on the return? Like my example way back I know some penny stock traders that made huge return but they have no clue of risk management and for the one successful hundreds got bust. Survival bias not skill.

I won't even comment on the Top 5 claim since it is very subjective.
I wasn't trying to convince. Just expressing my surprise at his patience.

I know a lost cause when I see one
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  #168  
Old 13.04.2016, 23:19
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Re: Investment fund

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Jeez. You have the patience of a saint to explain what should be obvious to any half-intelligent person...
Honestly Dude.Just because you have over 5000 posts and some slimy green lights does not give you the right to insult people.
It just means you posted more Shyte than most.
If you don't have anything positive to contribute,just shut it.
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  #169  
Old 13.04.2016, 23:27
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Re: Investment fund

Wow. All the sock puppets are coming out for this thread, huh?

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just shut it.
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  #170  
Old 13.04.2016, 23:36
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Re: Investment fund

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does not give you the right to insult people
I think you'll find that was a compliment...
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  #171  
Old 14.04.2016, 10:49
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Re: Investment fund

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I think you'll find that was a compliment...
Looks like it's not just your skin that's thick?
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  #172  
Old 14.04.2016, 11:02
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Re: Investment fund

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Looks like it's not just your skin that's thick?
It's OK, I can wait until you get it...


Last edited by Phil_MCR; 14.04.2016 at 11:16.
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  #173  
Old 14.04.2016, 11:09
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Re: Investment fund

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It's OK, I can wait until you get it...
Come on guys let's keep it on topic!
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  #174  
Old 14.04.2016, 11:20
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Re: Investment fund

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It's OK, I can wait until you get it...


Do us all a favour and hold your breath.
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  #175  
Old 14.04.2016, 11:29
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Re: Investment fund

back on topic

technical question on Fundsmith. intriguing fund this one. It is saying all the right things. hard to believe it is true.

The strategy is to buy and hold long term and values have been rising and doubling the fund in 4 years. Then when you would start investing now one might say that the fund is overvalued. This is unless the fund keeps finding these multinationals that match their criteria (is that possible?)

http://www.iii.co.uk/articles/227725...ity-overvalued
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  #176  
Old 14.04.2016, 11:33
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Re: Investment fund

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back on topic

technical question on Fundsmith. intriguing fund this one. It is saying all the right things. hard to believe it is true.

The strategy is to buy and hold long term and values have been rising and doubling the fund in 4 years. Then when you would start investing now one might say that the fund is overvalued. This is unless the fund keeps finding these multinationals that match their criteria (is that possible?)

http://www.iii.co.uk/articles/227725...ity-overvalued
IMO, equities as a whole are over-valued and so Fundsmith by extension is over-valued. But then everything is over-valued. The alternative of holding cash and waiting for a correction is fraught with risk.
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Old 14.04.2016, 11:39
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Re: Investment fund

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back on topic

technical question on Fundsmith. intriguing fund this one. It is saying all the right things. hard to believe it is true.

The strategy is to buy and hold long term and values have been rising and doubling the fund in 4 years. Then when you would start investing now one might say that the fund is overvalued. This is unless the fund keeps finding these multinationals that match their criteria (is that possible?)

http://www.iii.co.uk/articles/227725...ity-overvalued
The fund invests in about 27 stocks, there're about 70 stocks in the world that fit their criteria.

The stocks they invest in are not higher on average than the rest of the market, so the fund is not overvalued relative to the market.

If we still have roughly zero interest rates in 10 years time, todays prices will look like a bargain. If interest rates are 12% in 10 years time they will look expensive in hindsight.

When Fundsmith started, the commentators said it was a bad time to invest, 2 years later when the fund had risen 50% the commentators said it was possibly overvalued, 5 years on they say it's overvalued. I retired 18 months ago, we have seen 3 mini crashes in this time....... it was the end of the world if you listened to the background noise.

The greatest question is what is better to invest in, poor quality stocks? I doubt it & time will tell anyway. it's actually what most fund managers do.......
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IMO, equities as a whole are over-valued and so Fundsmith by extension is over-valued. But then everything is over-valued. The alternative of holding cash and waiting for a correction is fraught with risk.
History shows that the average retail investor only receives half the return of the fund they invest in as the keep buying & selling attempting to time the market. Terry Smith realises that's it's impossible to time the market so does not try, he won't even guess what the price will be tomorrow ....
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  #178  
Old 14.04.2016, 11:46
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Re: Investment fund

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If we still have roughly zero interest rates in 10 years time, todays prices will look like a bargain. If interest rates are 12% in 10 years time they will look expensive in hindsight.

the commentators said it was a bad time to invest, 2 years later when the fund had risen 50% the commentators said it was possibly overvalued, 5 years on they say it's overvalued.
funnily enough, your arguments can be applied exactly to the housing market
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Old 14.04.2016, 12:23
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Re: Investment fund

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back on topic

technical question on Fundsmith. intriguing fund this one. It is saying all the right things. hard to believe it is true.

The strategy is to buy and hold long term and values have been rising and doubling the fund in 4 years. Then when you would start investing now one might say that the fund is overvalued. This is unless the fund keeps finding these multinationals that match their criteria (is that possible?)

http://www.iii.co.uk/articles/227725...ity-overvalued
Number 1 rule is "Don't lose money"

I retired about 3 years ago.Made a lot of money buying at the height of the 2008 financial crisis.
So buy low sell high.

http://www.bloomberg.com/quote/FSEQFIA:LX

My advise is to monitor the funds graph and buy the dips.Also don't put all your money in at once.Do it in stages.
Good luck.
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  #180  
Old 14.04.2016, 12:26
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Re: Investment fund

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funnily enough, your arguments can be applied exactly to the housing market
Houses are generally bought with borrowed money, which is a very big difference it's a highly geared investment with zero short positions.

House prices are based on the availability of credit & not much else.

The stock market has both long & short positions in place.
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