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Article: No brains needed.
- Article from:
- Investors Chronicle - magazine and web content
- Article date:
- January 5, 2009
CopyrightCOPYRIGHT 2009 FT Business. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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Byline: Chris Dillow
PORTFOLIOS: Our no-brain portfolios suggest that markets might be efficient.
Could it be that the stock market is efficient, in the sense that you can only out-perform it by taking on extra risks? The performance of our no-brain portfolios in 2008 - a year when risks materialized most nastily - suggests it could be.
Those portfolios that do take extra risks had a horrible 2008. Our value portfolio - the 20 highest dividend yielders - fell 69.8 per cent and out high beta portfolio dropped 56.1 per cent. This suggests that the previous good performance of these strategies - in the two years before the credit crunch began on 1 ...