dreamland

[Doug Henwood <dhenwood@xxxxxxxxx>]

According to a poll by Montgomery Asset Management, U.S. mutual fund
investors expect 34% annual returns from their stock investments over the
next 10 years. Since average returns are in the 7-10% range (themselves
considered inexplicably high by canonical financial theory), one suspects
these folks are in dreamland. And that's not even figuring in mean
reversion or excess volatility, which suggest that after 15 years of
extraordinary returns, 10 more years of even more extraordinary returns are
highly unlikely.

Doug