In John Hussman’s first weekly market commentary for 2011, he revealed that he is completely alignment with Jeremy Grantham on that the large-cap, high quality is set up to strongly outperform small-cap and low quality over the next couple of years.
To illustrate his point, Hussman employs the following to graphs:
In both graphs, S&P 500 is the proxy for the high quality stocks whereas Nasdaq and Russell 2000 stand for low quality issues. When S&P 500 is cheaper than the other two indices, the other two indices tended to perform poorly in the next four years.
Despite his refined view towards different segment of the market, Hussman still call the stock market “remained characterized by an overvalued, overbought, overbullish, rising-yields condition that has historically produced poor average market returns, and consistently so across historical time frames.” And both his Strategic Growth Fund and Strategic International Fund are full hedged.
Read the full text of Hussman’s weekly market commentary here.
Check out Hussman's stock portfolio here.
To illustrate his point, Hussman employs the following to graphs:
In both graphs, S&P 500 is the proxy for the high quality stocks whereas Nasdaq and Russell 2000 stand for low quality issues. When S&P 500 is cheaper than the other two indices, the other two indices tended to perform poorly in the next four years.
Despite his refined view towards different segment of the market, Hussman still call the stock market “remained characterized by an overvalued, overbought, overbullish, rising-yields condition that has historically produced poor average market returns, and consistently so across historical time frames.” And both his Strategic Growth Fund and Strategic International Fund are full hedged.
Read the full text of Hussman’s weekly market commentary here.
Check out Hussman's stock portfolio here.
