03-07-2014, 05:07 PM
This SA article could be of interest to some of you. I just skimmed it, but tweaked my interest and will read in detail later. The article seems to mostly be discussing classes of stocks that outperform and why.
"Let's start with the more intuitive of the two factors. If you had $1 to invest in the year 1926, and the choice between a portfolio of large-caps or a portfolio of small-caps, ask yourself which you would choose. If you cashed out your investment in 2009, the small-cap portfolio would be worth around $12,971, more than 5 times as much as the large-cap portfolio. In fact, the average yearly return (arithmetic) for small-cap stocks since 1926 was 17.7% compared to the large-cap average of 11.7%. An investor in the small-cap portfolio would have swallowed immense losses at some points in the century, but these losses were more than compensated by aggressive gains at other points. The ends justify the means."
http://seekingalpha.com/article/1923321-...urce=yahoo
"Let's start with the more intuitive of the two factors. If you had $1 to invest in the year 1926, and the choice between a portfolio of large-caps or a portfolio of small-caps, ask yourself which you would choose. If you cashed out your investment in 2009, the small-cap portfolio would be worth around $12,971, more than 5 times as much as the large-cap portfolio. In fact, the average yearly return (arithmetic) for small-cap stocks since 1926 was 17.7% compared to the large-cap average of 11.7%. An investor in the small-cap portfolio would have swallowed immense losses at some points in the century, but these losses were more than compensated by aggressive gains at other points. The ends justify the means."
http://seekingalpha.com/article/1923321-...urce=yahoo
Alex