Quotes About Mean reversion

Paradoxically, in the long run, bonds are at least as risky as stocks. This is because stock returns are "mean reverting." That is, a series of bad years is likely to be followed by a series of good ones, repairing some of the damage.

History teaches that when valuations are extreme, "mean reversion," a move towards historical norms, is likely. Once value stocks turn, the recovery can be fast and intense.

Technical and fundamental analysis is usually useless as a trading edge,[...] Mindless strategies like mean reversion work until they don't and you suffer a blowout. Fundamentals are priced in. And no one can predict tomorrow's news.

The competitiveness of the world economy is such that mean reversion reigns, so you should buy the guys who are underperforming. Some of them will go bankrupt but many of them will come back up to the mean. Many of the growth stocks will also pull back to the mean as those who are great will become mediocre and those who are mediocre will become better.

Yes, our tree has an interesting shape. The center branches reflect the shape of the zero curve. When extreme parts of the tree are reached the branching pattern changes to accommodate the mean reversion.

super zip codes', looks increasingly like a new caste, equipped with the wealth and power to override the effects of mean reversion in human reproduction, so that even their dimmer progeny inherit their lifestyle.14

Investors tend to discover 'hot' mutual fund managers just after a successful run and just before the inescapable force of mean reversion is about to kick in.

Our starting point then was trying to find a way to incorporate mean reversion into the HoLee model.