Subject:
common stock legend Common Stock Legend is a term used in Capital Flow Analysis to refer to the common belief that a diversified portfolio of common stocks, held for the long run, is a safe investment for ordinary investors. The term is believed to have been coined by John Oswin Schroy of the Center for Capital Flow Analysis. Jeremy Siegel, a principal advocate of the Common Stock Legend and Professor of Finance at Wharton, popularized the concept with the book, “Stocks for the Long Run”.
Smooth sailing unlikely
By John Schroy, on May 20th, 2010 | 
Markets can be inefficient for different reasons and persist for long periods. The transition between one type of inefficient market to the next is usually a period of strife and uncertainty which may last five to fifteen years. Looking back at how the economy emerged from previous transitions, I note that in each new period, equity prices started at reasonable levels. This was true at the beginning of the Roaring Twenties, the Post WW II Period, and the Reagan Era. It is as if markets, recognizing prior inefficiencies ‘reset’ and start over. However, for the current market to ‘reset’, it will be necessary for equity prices to fall considerably, which will have dire consequences.
Post Modern Security Analysis
By John Schroy, on August 1st, 2009 | 
Security Analysis is the study of facts about negotiable instruments for the purpose of determining whether a particular instrument is appropriate for a specific investor at a particular time and the intrinsic value of the security compared to its market price, if any.
The technique has evolved over time with the changing nature of information.
In the 21st century, with a flood of open source information and increasingly complex, global markets, new approaches are necessary.
US equity markets:
By John Schroy, on July 11th, 2009 | 
The long-held doctrine of blindly holding ‘Stocks for the Long Run’ is now being questioned.
Jason Zweig in a Wall Street Journal opinion piece points out that the data on which the ‘Common Stock Legend’ is based turns out to be flawed.
But then, we all knew that anyway.
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