Arnold Van Den Berg thinks that the current stock market is way overvalued. He has been selling stocks and accumulating cash, and waiting for buying opportunities. He used the example of the stock market from 1965 to 1982 to show that investors who adhered to the “buy and hold forever” strategy, as well as those who believed that buying an index was the only way to go regardless of the fundamentals, made virtually no money. He argues that for those investors who bought and sold individual stocks based on fundamentals, discipline, and value, there were numerous opportunities to make great profits during this same period.
This is a great newsletter (72 pages) from one of the superinvestors.
Thank you GuruFocus for this wonderful link.