In this episode, Mark talks about anxiety index from Investopedia. There are two forms of investors:
1. People who say when you invest money you invest it into the stock market and you do so buying indexes. Don't invest in businesses invest in the market, just own the stock market.
2. The stock picker, the manager who invests in businesses
The bull market is a market where the stocks are going higher over time. Bullish sentiment is that stock prices will rise. This is the 24th time out of the last 25 weeks that optimism is below historical average of 38.5. The valuations of a market or a business is relative, not absolute. Mark also talks about the CRSP database and monthly returns for every stock. The issue isn’t where you go for the best returns, it's which stocks you choose. It's about diversification, not over diversification and investing in good businesses over time.
July 11, 2017