tag:blogger.com,1999:blog-2149523431587168680.post3992117055790193054..comments2024-01-16T00:12:23.220-05:00Comments on Oddball Stocks: Investing gap between theory and practiceNate Tobikhttp://www.blogger.com/profile/05660387777171986124noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-2149523431587168680.post-21803419049772177092015-01-07T02:13:55.054-05:002015-01-07T02:13:55.054-05:00Your blog contains an really astounding informatio...Your blog contains an really astounding information to your readers and I really enjoyed this one. thanks for this post.rosewoodhttp://www.ljcbuildersandpromoters.com/noreply@blogger.comtag:blogger.com,1999:blog-2149523431587168680.post-48924546575404582562014-12-19T17:00:32.715-05:002014-12-19T17:00:32.715-05:00Marty Whitman's books/shareholder letters are ...Marty Whitman's books/shareholder letters are always fun to read because of his complaints against efficient market theory. He calls academics technicians with PHDs. Some of his points include the following (paraphrased): <br /><br />Academic theories are sort of ridiculous if you deconstruct them. One such claim is that because mutual fund managers cannot routinely beat the market that the market is efficient. Mutual funds aren't exactly the best vehicles for beating the market. You may have uneducated investors that force the mutual fund to sell at exactly the wrong times; the fund may be constrained to investing in one industry etc. The theory is like saying that because a man in a blue shirt with one arm tied behind his back can't box that all men with blue shirts can't box. Routinely beating the markets is difficult but beating them on average over time has been done by Third Avenue and others. <br /><br />Another ridiculous thing about typical academic investment theory is that although efficient market theorists do not believe in technical analysis they use technical analysis in numerical form (beta). Whenever a theory contradicts itself it's probably not worth the effort of learning. Also when a theory (such as efficient market hypothesis) is later refuted by research of the creator of said theory it is probably not worthwhile. Yet it is still taught in universities all over the world. <br /><br />There are some academic-types that conduct worthwhile research (Piotroski, Altman + so on). But I find it much more interesting to buy books detailing the experiences of successful practitioners because their advice is more likely to be worthwhile than someone with limited investing experience. Or for that matter than from academics with terrible track records whose funds have become insolvent. <br />Anonymousnoreply@blogger.com