Chuck Royce on Third Quarter 2009

Oct 26, 2009

In this latest interview, Chuck Royce looks at the ongoing bull period and discusses why a more historically typical market might be a good thing for long-term investors.

Do you think that the market's recent momentum can continue?

I don't think it can, certainly not to the same degree that we've seen since the low on March 9. The rally for stocks has been a wonderful development, but I don't see this kind of very dynamic, robust upswing continuing for much longer. At the same time, I'm not saying that stocks are headed for a dramatic plunge, though a 10-15% correction would not be surprising. In any case, I think that we should soon enter a period of more historically normalized, positive long-term returns. Clearly stock prices would need to keep rising for that to occur—they simply aren't likely to continue climbing at the pace that was set in March. It seems to me that this might even be a welcome occurrence—after the last couple of years, some historically typical returns would probably be a good thing for all of us.

How do you see the market taking shape in the next three to five years?

Read the complete interview

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