Hermes Econometrics — Information for Investors

Market Mythology and Econometrics

Fri, 12 Dec 2003 11:00:00 PST

Theories predicting the direction of the stock market have been popular since stocks were traded under the buttonwood tree, on a street in lower Manhattan, which eventually became Wall Street. Some theories include: the Super Bowl Theory, the January Theory, and the Hemline Theory.

Timeline: September 2001

Thu, 26 Jun 2003 16:00:00 PST

During the period of September 11th through September 17th 2001, Hermes Econometrics remained open to collect data, monitor markets, implement trades on behalf of clients, and was available to respond to any concerns of investors and brokers.

Index Funds & Risk Management — a Winning Combination

Fri, 6 Jun 2003 17:20:00 PST

Managed mutual funds compare their returns to a benchmark index. Many actively managed U.S. stock mutual funds compare their returns to the S&P 500 index. Surprisingly, the S&P is difficult for most funds to beat. Over the last 10 years, actively managed funds are ahead of the underlying index just 23% of the time (source: Rydex, Morningstar).

The Role of Objectivity

Fri, 25 Apr 2003 15:01:00 PST

Emotions and subjectivity can play an undesirable role in a person's ability to execute buy and sell decisions that ultimately determine results. The real scenario described in the accompanying article will help you to experience what happened in September, 2001 from the viewpoint of an asset manager.

How Hermes Parallels The Fed To Protect Your Investment

Tue, 22 Apr 2003 14:01:00 PST

When on Wall Street, Do as the Fed does.

Investing In The 21st Century — Rational Exuberance

Fri, 11 Apr 2003 15:40:00 PDT

The Markets of 2000 and 2001 have shattered the expectation of investors. Did you think stocks were automatically safe and profitable if you held them long enough? Many did and many have lost money. The 1990's marked a pinnacle of prosperity for equity investors. In contrast, today's investors are speculating how much lower the market will go. It is important to understand market declines and how to protect against them.

A Modern Day Fairy Tale — GRIM but True

Thu, 3 Apr 2003 12:01:00 PST

There once was a happy dollar. It was so happy with all the news it had heard about the NASDAQ candy store on Pleasure Island, it had to go see for itself. There was candy everywhere in 1999! So the happy dollar ate and ate and ate. It ate so much that it grew to $1.86!! All in one happy year.

Timing Doesn't Have to Be Perfect to Beat Buy and Hold

Fri, 28 Mar 2003 12:01:00 PST

The most common argument against market timing is that investors will miss the best days of the market and see their returns suffer dramatically. But, before you buy this argument, you should look at the flip side - what happens if you miss the worst days? - says the Society of Asset Allocators and Fund Timers, Inc. (SAAFTI). And perhaps even more likely, what would happen if you miss both the best and the worst days?

One Wall Street Truth You Can't Trust

Thu, 27 Mar 2003 12:00:00 PST

"Buy a good company, hold it, and over time, you'll make money." When investing in today's market, this conventional wisdom has been true for over two decades. What we forget is that conventional wisdom is, by definition, grounded in the experience and customs/conventions of a particular time and place. At each point in time, such truths seem self-evident.