S&P 500
7,226.20
+0.01%
Dow Jones
49,494.60
-0.62%
Nasdaq 100
27,685.40
+0.66%
Russell 2000
2,804.78
-0.02%
FTSE 100
10,364.50
0.00%
Nikkei 225
59,260.50
-0.78%

Investing

Volatility Gremlins

Photo of Douglas A. McIntyre
By Douglas A. McIntyre Published
Follow 24/7 Wall St. on Google
This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.

Volatility Gremlins

Readers have been emailing me about the returns of the models I have presented in the last few posts. Rather than respond to all of them individually, I thought I would just post the year by year returns for the S&P500, the 1-Year MO model, the 1-Month MO model, and a combo of the two models. Recall that no estimates have been subtracted for commissions, fees, or taxes.

(You may have to click on the Table to get it to open in a separate window for better viewing)…

You will notice the effect the higher volatility has on reducing average return to a lower CAGR than a lower volatility with the same return. Ed Easterling [2006] has a good discussion of these “volatility gremlins” in John Mauldin’s Book, “Just One Thing”.

Posted by Mebane Faber

http://worldbeta.blogspot.com/

Photo of Douglas A. McIntyre
About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

Featured Reads

Our top personal finance-related articles today. Your wallet will thank you later.

39% of Americans Are Betting on Crypto and Prediction Markets Instead of Saving
David Beren |

39% of Americans Are Betting on Crypto and Prediction Markets Instead of Saving
A $300,000 Annuity Guarantees $1,900 a Month for Life, but Here Is What Retirees Are Giving Up
Drew Wood |

A $300,000 Annuity Guarantees $1,900 a Month for Life, but Here Is What Retirees Are Giving Up

Continue Reading

Douglas A. McIntyre |

Holy Betas!

From World Beta Are hedge funds returning great performance, or is it merely an illusion and they’re selling world betas…
Will Simplify Managed Futures ETF Finally Move Higher In 2026?
Michael Williams |

Will Simplify Managed Futures ETF Finally Move Higher In 2026?

Simplify Managed Futures Strategy ETF (NYSEARCA:CTA) has disappointed investors seeking diversification through trend-following strategies. Since launching in March 2022, the…
These Are the 2 Biggest Stocks in This $68 Billion Hedge Fund
Rich Duprey |

These Are the 2 Biggest Stocks in This $68 Billion Hedge Fund

While many investors might not know who Israel Englander is, they have likely heard of his Millennium Management hedge fund.…
Douglas A. McIntyre |

Improving the Timing Model

From World Beta Can adding some complexity squeeze out some more performance? In my paper, I examined how a simple…
Opendoor Turned $1,000 Into $705 While the S&P 500 Nearly Doubled
William Temple |

Opendoor Turned $1,000 Into $705 While the S&P 500 Nearly Doubled

Opendoor Technologies (NASDAQ: OPEN) went public via SPAC merger in December 2020 with a bold vision: use technology to eliminate…
If You Bought Coca-Cola When Buffett Did, Here’s What You Have Today
Trey Thoelcke |

If You Bought Coca-Cola When Buffett Did, Here’s What You Have Today

Coca-Cola (NYSE: KO | KO Price Prediction) is one of the most famous long-term investment stories in history, starting with…
Chris Lange |

How Dow Chemical May Be Escaping Low Energy Prices

Dow Chemical reported its fourth-quarter results Thursday before the U.S. markets opened.
3 AI-Driven Dividend Stocks That Still Offer Real Value
David Beren |

3 AI-Driven Dividend Stocks That Still Offer Real Value

Even as the investing world continues to debate whether we are or are not in an “AI bubble,” there shouldn’t…
Lee Jackson |

4 Top Chip Stocks to Buy That Benefit From Return to Lower Volatility

The following four semiconductor stocks in the UBS coverage universe look to benefit from the expected return to lower volatility.

Top Gaining Stocks

Cboe Global Markets
CBOE • Vol: 1,568,143
New Pluto Global
PSKY • Vol: 12,285,993
Seagate Technology
STX • Vol: 7,378,346
Oracle
ORCL • Vol: 26,317,675
Datadog
DDOG • Vol: 6,247,779

Top Losing Stocks

LKQ
LKQ • Vol: 4,367,433
Clorox
CLX • Vol: 13,260,523
Stryker
SYK • Vol: 4,519,455
Mohawk Industries
MHK • Vol: 1,859,865
Amgen
AMGN • Vol: 3,818,618