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41 of 49 people found the following review helpful:Outdated. Do not buy the author's hypothesis uncritically,
The Role of Luck in Siegel's Success,
April 24, 2005
An absolute disappointment. This is a classic example of misreading the formula that made you successful in the first place. Sequels are usually bad, in this case Siegel's are bad. The reviews and cover quote by Warren Buffett are misleading, and I seriously doubt whether the reviewers read the book. There is nothing new here. Undervalued stocks (value stocks) have been touted as being superior forms of investment for a long time. Eugene Fama, and others, have produced fantastic research in this area. I found the book to be self aggrandising, offering no original contribution and totally out of character relative to the first book. The data mining is significant, and to suggest that tried and true is the way forward simply because the past delivered such a pattern is foolhardy. Give this book a miss.
By Mark Pawley - See all my reviews
54 of 144 people found the following review helpful:
BAD INSIGHTS UNDERLYING A BAD BOOK,
March 15, 2005
By David Smith "David Smith" (Los Angeles, CA) - See all my reviews
Jeremy Segal has put forth what he must consider to be the remarkable research that stocks that pay dividends outperform those that do not. He then ignores the effect of taxes, includes the benefit of hindsight in cherry picking his choices and then covers those errors with a surplus of data mining.
He makes no apology for his other bad book Stocks for the Long Run, which too pretended that stocks going up and down 40% or more four times within four years is not something to worry about because a Wharton professor who forgets to include taxes in his analysis thinks so.
The problem with Jeremy Siegal and his cohorts is this: they are trying to stretch a discredited theory about efficient capital markets well past its stretching point. In that task, they have the support of the mutual fund industry, which too would love people to close their eyes and keep buying the same amount of stock at the same time every month. In other words, the book is the work of a panderer and lobbyist for the mutual fund industry, and is no more interesting than say reading about solving the problems of terrorism from a lobbyist for Tazer or any other equipment manufacturer. Like all lobbyists he too has independent affiliations.
What makes the book particularly bad on its face is exactly that, its cover, which has citations from Warren Buffet and Robert Shiller, who in their main success have discredited the very theory underlying Jeremy Segal's book. Nothing smacks of contradictions more than an author in the sunset of his career running for endorsements from the very people who have eviscerated the conclusions of that career.
This is a bad book with bad insights from a bad professor of finance. If anyone disagrees, they may do well to answer the simple question: if the tried and true does trump over the bold and the new, and if you love dividends, why buy stocks at all sherlock. Buy REAL ESTATE (which is the index fund with lessor volatity and which by definition is where all profits ultimately show up, especially if you want to avoid the bold and the new). And if he loves stocks only, don't REITS pay the highest dividend anyway, so why spend part of the book about the coming fiscal crisis and not the highest paying dividends.
Finally, PLEASE DONT WRITE BOOKS WHERE THE INVESTMENT ADVANTAGE IS 2%. IT IS NOT WORTH THE UPS AND DOWNS OF 1987, 1989, 1994, 1998, 2000, 2001, 2002.