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Stocks for the Long Run : The Definitive Guide to Financial Market Returns and Long-Term Investment Strategies
"One of the ten best investing books of all time."-- The Washington Post One of investing's most celebrated icons updates his classic work to reflect today's world and markets In this long-awaited and eagerly anticipated update, Jeremy iegel provides his legendary perspective and guidance to an investment world turned upside down. Stocks for the Long Run combines a compelling and timely portrait of today's turbulent stock market with the strategies, tools, and techniques investors need to maintain their focus and achieve meaningful stock returns over time. This completely updated edition includes entirely new data, charts, and figures as it provides answers on the five major issues concerning investors and professionals
383 pages, Hardcover
First published January 1, 1994
About the author
Jeremy J. Siegel
11 books77 followersJeremy J. Siegel is the Professor of Finance at the Wharton School of the University of Pennsylvania in Philadelphia, Pennsylvania.
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Displaying 1 - 30 of 158 reviews
August 1, 2019
Here are what I have learned from the book
- Losing portfolio outperform winning portfolio on the long run
- Small cap outperform large cap on the long run
- Buy and hold is the best strategy ever
- You can never predict the market, if you do then you will do 0.5% better than buy and hold
- Value beats quality in the long term, try comparing google vs Black Stanley with dividends
- Never consider any asset class other than stocks
- Stocks is less sensitive to inflation in the long term
- Stocks are bad in the short term and great in the long term, the award is given to those who is patient not those who work hard
- Studies confirms that checking the portfolio every year have negative effect compared to checking every 10 years
- In trading, the past doesn't say anything about the future, every rule made had a random results.
- In investing the past say that business quality and value are more important than everything else.
- Stocks growth have negative correlation with economic growth
- Investing anywhere in the world in the long term will guarantee high results, only avoid bubbles like Japan 90s
- Ignore book value in evaluation
- Never react to economic or political news, and never look at business cycle trends
- Losing portfolio outperform winning portfolio on the long run
- Small cap outperform large cap on the long run
- Buy and hold is the best strategy ever
- You can never predict the market, if you do then you will do 0.5% better than buy and hold
- Value beats quality in the long term, try comparing google vs Black Stanley with dividends
- Never consider any asset class other than stocks
- Stocks is less sensitive to inflation in the long term
- Stocks are bad in the short term and great in the long term, the award is given to those who is patient not those who work hard
- Studies confirms that checking the portfolio every year have negative effect compared to checking every 10 years
- In trading, the past doesn't say anything about the future, every rule made had a random results.
- In investing the past say that business quality and value are more important than everything else.
- Stocks growth have negative correlation with economic growth
- Investing anywhere in the world in the long term will guarantee high results, only avoid bubbles like Japan 90s
- Ignore book value in evaluation
- Never react to economic or political news, and never look at business cycle trends
May 7, 2016
Fantastic book, great analysis, but a wrong conclusion that stocks can be bought at any time e.g. even when overvalued. the book was written just as the bubble burst.
May 16, 2011
A solid (yet very bullish) defense of long-term investing (for investors with a horizon of 20 years or more). Read with care! If your investment horizon is less (even if its 10 or 15 years) this book must be read in combination with Robert Shiller's Irrational Exuberance. Shiller explains how the business cycle can produce devastating returns even to those following relatively conservative strategies over periods less than 20 years when they invest at times of high P/E and B/V ratios and low dividend yields (i.e. near the peak of a stock market bubble) - conditions such as we find today.
With this in mind, Siegel provides some interesting thoughts and some great analysis on 200 years of data. It's interesting how much better the risk profile of stocks has been versus bonds over longer periods (>20 years) during the last 100 years. This has been due to unexpected yet devastating periods of inflation that come along more often than people realize and wipe out real returns on bonds (stocks fare better over the long term given their link to real assets).
An interesting section on the book discussed reasons why the average Shiller P/E (that divides current prices by 10 years of earnings data) should be at a higher level than the historic average of 16x - perhaps something more like 20x (we are at 24x as of May 2011) due to structural reasons such as reduced capital gains taxes, decreased earnings volatility in the business cycle, lower dividend payout ratios and a more-aggressive fed that won't let 1929 happen again, In Irrational Exuberance, Shiller provides an excellent defense against these arguments that are actually a lot weaker than they sound in Siegel's hands, as well as a few negative factors not contemplated by Siegel. That said, Siegel's key points are worth reading and considering - perhaps a level between the two authors is an appropriate yardstick going forward.
I was concerned to find chapters toward the end of the book on calendar stock market effects and technical and momentum investing strategies - things that should clearly not find a place in a book titled "stocks for the long run"!
Despite, weakening substantially toward the end of the book and the author's clearly bullish bias (one that has cost a lot of investors a lot of money given the books first release in 1994!) I found this an interesting companion to the likes of Shiller, Klarman, Montier and Graham and would recommend it those interested in learning what different asset classes have done over the last 200 years and what realistic expectations could be going forward.
With this in mind, Siegel provides some interesting thoughts and some great analysis on 200 years of data. It's interesting how much better the risk profile of stocks has been versus bonds over longer periods (>20 years) during the last 100 years. This has been due to unexpected yet devastating periods of inflation that come along more often than people realize and wipe out real returns on bonds (stocks fare better over the long term given their link to real assets).
An interesting section on the book discussed reasons why the average Shiller P/E (that divides current prices by 10 years of earnings data) should be at a higher level than the historic average of 16x - perhaps something more like 20x (we are at 24x as of May 2011) due to structural reasons such as reduced capital gains taxes, decreased earnings volatility in the business cycle, lower dividend payout ratios and a more-aggressive fed that won't let 1929 happen again, In Irrational Exuberance, Shiller provides an excellent defense against these arguments that are actually a lot weaker than they sound in Siegel's hands, as well as a few negative factors not contemplated by Siegel. That said, Siegel's key points are worth reading and considering - perhaps a level between the two authors is an appropriate yardstick going forward.
I was concerned to find chapters toward the end of the book on calendar stock market effects and technical and momentum investing strategies - things that should clearly not find a place in a book titled "stocks for the long run"!
Despite, weakening substantially toward the end of the book and the author's clearly bullish bias (one that has cost a lot of investors a lot of money given the books first release in 1994!) I found this an interesting companion to the likes of Shiller, Klarman, Montier and Graham and would recommend it those interested in learning what different asset classes have done over the last 200 years and what realistic expectations could be going forward.
May 16, 2015
The most valuable part of the book is the historical return data and accompanying analysis. He presents interesting reference information on returns, sector composition of the stock markets over time and geographies, and the performance of various strategies that attempt to outperform the market.
Siegel presents a convincing case for the historical outperformance of stocks in the US, but does not aggressively tackle the most obvious critique of this work - that by analyzing the current hedgemon it is not surprising he finds great historical performance of financial instruments linked to growth. He extrapolates past returns to predict future returns, without accounting for the selection bias.
See Triumph of the Optimists: 101 Years of Global Investment Returns for a global perspective. That book offers a more academic and more realistic perspective.
Still - this is a worthwhile read for amateur investors.
Siegel presents a convincing case for the historical outperformance of stocks in the US, but does not aggressively tackle the most obvious critique of this work - that by analyzing the current hedgemon it is not surprising he finds great historical performance of financial instruments linked to growth. He extrapolates past returns to predict future returns, without accounting for the selection bias.
See Triumph of the Optimists: 101 Years of Global Investment Returns for a global perspective. That book offers a more academic and more realistic perspective.
Still - this is a worthwhile read for amateur investors.
December 12, 2017
با اینکه اشکم را دراورد تا تموم شد اما واقعا کتاب مفید و کاربردی در رابطه با سهام هم برای مبتدیان از جمله خودم و هم افراد حرفه ای بود. اگر تصمیم به فعالیت در این زمینه دارید صد در صد خوندن این کتاب بهش پیشنهاد میشه
May 14, 2015
From where should I begin?
This "peace of art" is a must read for anyone who is interested in investment specially those who care most about stock markets.
It is crystal clear to anyone who reads this book, the "enormous" effort done by the author of this book. There are hundreds of tables, graphs, comparisons, studies, ... etc.
Actually, the book is so rich and so good that I cannot express how good is it. When The Washington Post said about this book: "One of the best investment books of all time", they were not exaggerating at all.
I think I am not able to write a review that contains what can you find in the book. So, take a look at the table of contents and you will know what to expect. I can assure who ever read this book that he will not only have a comprehensive understanding about stocks but the correlation between stocks with nearly everything.
I will definitely read the book again and I will read certain chapters again and again and again.
This "peace of art" is a must read for anyone who is interested in investment specially those who care most about stock markets.
It is crystal clear to anyone who reads this book, the "enormous" effort done by the author of this book. There are hundreds of tables, graphs, comparisons, studies, ... etc.
Actually, the book is so rich and so good that I cannot express how good is it. When The Washington Post said about this book: "One of the best investment books of all time", they were not exaggerating at all.
I think I am not able to write a review that contains what can you find in the book. So, take a look at the table of contents and you will know what to expect. I can assure who ever read this book that he will not only have a comprehensive understanding about stocks but the correlation between stocks with nearly everything.
I will definitely read the book again and I will read certain chapters again and again and again.
January 30, 2024
This book is similar to a educational text book that teaches fundamentals of investing. The book was cut and dry with very old examples. I have a hard time accepting that patterns relevant in the early 1900’s still hold true to theory today. Siegel has a brilliant mindset and I look forward to his weekly commentary. I do think his writing is overly bullish and a beginner investor should read with caution.
September 30, 2019
One of the best books that I have read about investment. The author is clear and provides plenty of data and statistics about his points of view. It's not a book to read in a couple of days. It took me quite a bit to finish it, because I needed some time understand all the analysis and conclusions, often counter intuitive, that the author puts over the table.
March 25, 2023
I learned that stocks are good!
September 5, 2023
2023-09-05 update:
“One of the 10 best investment books of all time.” - the Washington post
I tend to agree. This book was first (1994-1998 just before a crash) published in a special time when stocks rose to all time highs, but is still very valuable as a guide, to sensible valuation of stocks.
Of all relevant asset classes, over 210 years, stocks have outperformed with 6,6% per year - after inflation.
Author: J. Siegel is a professor of Finance at Wharton.
Why read: “one of the ten best investment books of all time” The 5th edition and the most complete summary of historical trends in stock market returns (about 200 years of data). What impact? For a young person this is a must read because of the impact of time and compound interest on wealth.
Published by McGraw-Hill Education copyright 2014 by Jeremy J. Siegel.
One surprising fact is how insignificant big events are to the stock market long term. Wars are declared, 9/11, sudden drops in one day up to double digits, presidents are assassinated and trough all this the market moves relentlessly upward. Another takeaway is the “natural” rate of growth at about 6-7% over time. This is helpful to keep things in perspective. Naturally, stocks outperformed all other asset classes. And how to manage risk in relation to the expected higher return. Below some great summary rules to keep in mind.
1. Keep your expectations in line with history. Historically stocks have returned between 6 and 7 percent after inflation over the last two centuries and have sold at an average P/E ratio of about 15.
2. Stock returns are much more stable in the long run than in the short run. Over time stocks, in contrast to bonds, compensate investors for higher inflation. Therefore, as your investment horizon becomes longer, put a larger fraction of your assets in equities.
3. Invest the largest percentage of your stock portfolio in low-cost stock index funds.
4. Invest at least one-third of your equity portfolio in international stocks, currently defined as those not headquartered in the United States. Stocks in high-growth countries often become overpriced and yield poor returns for investors.
5. Historically, value stocks - those with lower P/E ratios and higher dividend yields - have superior returns and lower risk than growth stocks. Tilt your portfolio toward value by buying passive indexed portfolios of value stocks or, fundamentally weighted index funds.
6. Finally, establish firm rules to keep your portfolio on track, especially if you find yourself giving in to the emotion of the moment. If you are particularly anxious about the market, sit down and reread the first chapter of this book.
“One of the 10 best investment books of all time.” - the Washington post
I tend to agree. This book was first (1994-1998 just before a crash) published in a special time when stocks rose to all time highs, but is still very valuable as a guide, to sensible valuation of stocks.
Of all relevant asset classes, over 210 years, stocks have outperformed with 6,6% per year - after inflation.
Author: J. Siegel is a professor of Finance at Wharton.
Why read: “one of the ten best investment books of all time” The 5th edition and the most complete summary of historical trends in stock market returns (about 200 years of data). What impact? For a young person this is a must read because of the impact of time and compound interest on wealth.
Published by McGraw-Hill Education copyright 2014 by Jeremy J. Siegel.
One surprising fact is how insignificant big events are to the stock market long term. Wars are declared, 9/11, sudden drops in one day up to double digits, presidents are assassinated and trough all this the market moves relentlessly upward. Another takeaway is the “natural” rate of growth at about 6-7% over time. This is helpful to keep things in perspective. Naturally, stocks outperformed all other asset classes. And how to manage risk in relation to the expected higher return. Below some great summary rules to keep in mind.
1. Keep your expectations in line with history. Historically stocks have returned between 6 and 7 percent after inflation over the last two centuries and have sold at an average P/E ratio of about 15.
2. Stock returns are much more stable in the long run than in the short run. Over time stocks, in contrast to bonds, compensate investors for higher inflation. Therefore, as your investment horizon becomes longer, put a larger fraction of your assets in equities.
3. Invest the largest percentage of your stock portfolio in low-cost stock index funds.
4. Invest at least one-third of your equity portfolio in international stocks, currently defined as those not headquartered in the United States. Stocks in high-growth countries often become overpriced and yield poor returns for investors.
5. Historically, value stocks - those with lower P/E ratios and higher dividend yields - have superior returns and lower risk than growth stocks. Tilt your portfolio toward value by buying passive indexed portfolios of value stocks or, fundamentally weighted index funds.
6. Finally, establish firm rules to keep your portfolio on track, especially if you find yourself giving in to the emotion of the moment. If you are particularly anxious about the market, sit down and reread the first chapter of this book.
November 17, 2018
3.5 rating
There wasn't any new revelation or conclusion that was made by me when I finished reading this book. I have read quite a couple of other really good books and so haven't been that surprised. That said, as the synopsis describes; this book indeed supplies a nice portrait of the stock exchange especially that of the USA.
There wasn't any new revelation or conclusion that was made by me when I finished reading this book. I have read quite a couple of other really good books and so haven't been that surprised. That said, as the synopsis describes; this book indeed supplies a nice portrait of the stock exchange especially that of the USA.
December 25, 2015
Realmente uma Bíblia do investimento no Longo Prazo (LP).
Demonstra como o "senso-comum" e a busca por rentabilidades (girando cada vez mais seu patrimônio, como é comum vermos as pessoas fazendo ao seguirem recomendações de "gurus" e mídia especializada) não são eficientes no LP.
Demonstra como o "senso-comum" e a busca por rentabilidades (girando cada vez mais seu patrimônio, como é comum vermos as pessoas fazendo ao seguirem recomendações de "gurus" e mídia especializada) não são eficientes no LP.
May 26, 2020
لماذا هذا الكتاب رائع؟لأن ��.جيرمي خالف العرف السائد في كتب الاستثمار , لم يعطك وصفة جاهزة و إنما غطى أهم المواضيع الاستثمارية و علق عليها احصائياً .. مثال ما هي نسبة نجاح محفظتك لم اشتريت الأسهم شهر يناير بدل من سبتمر؟
الكتاب ممتاز و أنصح به بشدة
الكتاب ممتاز و أنصح به بشدة
January 12, 2018
one of the best books I read so far on the stock market. highly recommended for anyone interested in investing
it covers all the main themes in investing
it covers all the main themes in investing
March 9, 2022
É excelente em mostrar um panorama geral sobre investir em renda variável, tanto explicando o prêmio de ações em comparação ao demais investimentos, quanto o prêmio dos demais fatores, como ações de valor, de menor capitalização (small stocks), entre outros. Adorei que não só o autor mostra o histórico, mas também inclui fontes e referências para suas afirmações durante a leitura mesmo. Também gostei que, em alguns capítulos, o autor assume uma postura neutra, mostrando as vantagens e desvantagens de algumas estratégias, como análise técnica. Fiquei surpresa também porque ele sugere que a pequena investidora use estratégias passivas, sempre focando em reduzir o custo e não tentar bater o mercado. Tem um capítulo sobre economia comportamental, mas ainda acho melhor ler direto Pensar rápido, pensar despacio.
Porém, achei que foca muito no mercado estadunidense, e não explora muito sobre os demais mercados de capitais. Em um dos capítulos, ele coloca que os investidores dos EUA não têm por que se preocupar com supervalorização das ações estadunidenses. E justifica isso dizendo que os investidores de países emergentes vão comprar as ações dos EUA porque assume que o mercado EUA continuará sendo o mais estável daqui a 30-40 anos.
Porém, achei que foca muito no mercado estadunidense, e não explora muito sobre os demais mercados de capitais. Em um dos capítulos, ele coloca que os investidores dos EUA não têm por que se preocupar com supervalorização das ações estadunidenses. E justifica isso dizendo que os investidores de países emergentes vão comprar as ações dos EUA porque assume que o mercado EUA continuará sendo o mais estável daqui a 30-40 anos.
November 15, 2017
Very interesting book, although many of the chapters boil down to: here's how you could time the market, here's how trends work and how you can buy based on them, here's how.... and end with "but seriously, just buy broad-based low-cost index funds as that's the way to do it. At least the conclusion is right even if the explanation of all sorts of complex ideas that sometimes did and often don't work makes you think for a while that people can actually beat the market (hint: they can't do so consistently, mostly it's luck if they do, and transaction costs means that most of the time they don't actually beat the market after transaction costs and taxes are taken into account).
September 14, 2020
8.3/10– Good insight, foundational, not exciting
Provided splendid insight to the world economy in reference to the modern market. Foundational to all investors, examining all aspects from macro economics to the psychology of behavioral investing. Can be a hard read, not the most exciting, need lots of coffee to finish it.
Provided splendid insight to the world economy in reference to the modern market. Foundational to all investors, examining all aspects from macro economics to the psychology of behavioral investing. Can be a hard read, not the most exciting, need lots of coffee to finish it.
March 17, 2020
مرجع رئيسي فيما يتعلق بسوق الاسهم والبورصة خاصة السوق الامريكي لاغنى عنه لاي مهتم بهذا الموضوع
شكرا لمعهد الادارة العامة على ترجمة هذا الكتاب وطبعة وشكرا للمترجمة الفاضلة الدكتورة هند
شكرا لمعهد الادارة العامة على ترجمة هذا الكتاب وطبعة وشكرا للمترجمة الفاضلة الدكتورة هند
January 11, 2021
Excelente.
Importante para evitar os erros mais comuns.
Importante para evitar os erros mais comuns.
September 15, 2014
A must read for those who are inclined to believe that sending your hard-earned money to strangers on Wall Street who promise to send back even more money over the next 20 - 30 yrs will end well.
This still one of the classic stock market investing books by a brilliant economic professor at the Univ. of Pennsylvania Wharton School. If you own stocks you need to own this book.
Just remember the "long term" is based on a 50 yr hold period. If you get in at the wrong end of a 10-20 yr flat period (1930-1952, 1967-1977, 1999-2012) the market might remain flat longer than you can remain solvent.
This still one of the classic stock market investing books by a brilliant economic professor at the Univ. of Pennsylvania Wharton School. If you own stocks you need to own this book.
Just remember the "long term" is based on a 50 yr hold period. If you get in at the wrong end of a 10-20 yr flat period (1930-1952, 1967-1977, 1999-2012) the market might remain flat longer than you can remain solvent.
September 6, 2015
This review is for the fifth edition which should be read over past editions for sure with additional information on more recent trends and the great recession of 2008. Excellent book that covers many different topics, supports the firm foundation theory and fundamental analysis of equities. Favors fundamental or value index funds, dividend paying companies with long term growth, low risk long term investing. Obviously biased towards long term investments. I tend to agree with many of the authors suggestions based on the data but ignoring higher risk short term opportunities does prevent some potential profits but could keep you from losing a lot as well.
February 1, 2015
I first saw and heard about Jeremy Siegel on CNBC one day and it got me curious to learn more about him. I liked the first part of the book which is an interesting reminder of the stock market events over the 20th century. I was also happy to learn about the Irving Fisher Quote from 1929 "a permanently high plateau" which I didn't know before. The author is an advocate of equity long term passive low cost indexing, but it would have been interesting to read his thoughts on the value investing discipline practiced by Warren Buffet.
March 28, 2015
A good follow up to a Random Walk Down Wall Street. A good source to show much of the long term data that should drive an investing strategy with adequate reminders (if you are attentive - Siegel has a bullish reputation) that the next 100 years may not have similar outcomes to the last 100 and that we may be looking at a future of lower stock yields. It remains logical to believe that there should still be a risk premium of stocks over bonds, but it seems unlikely to be as large in the future as it was over the 20th century.
February 25, 2016
An academic-oriented summary of equity portfolio construction principles. It focuses is on the analysis and interpretation of historical performance data and does not really attempt to go beyond this scope. It is really solid overview which unlike a lot of other books is healthily skeptical about 'beat-the-market' strategies without being dogmatic about it. The book is generally really thorough and evidence-based in its delivery, with some occasional sections which are a little sloppy and could unintentionally encourage speculative behaviour in the eye of the untrained or inexperienced.
January 21, 2016
For the quantitatively inclined, this book gives a thorough and rational discussion of the long-term performance of financial markets. The conclusions are supported by many insightful plots, not by the "rules of thumb" one finds in lesser contributions to this literature. The book does a good job of straddling the line between general discussion and specific, actionable advice. Every person with money to invest over the long term (i.e., every person) should read this book.
March 30, 2016
Begins with an excellent review of how historical events and movement of the market.
Explains why the higher risk of equities is more than offset by the higher returns in the long run and is really less risk than bonds or Treasuries.
Moves into factors involved in valuing stocks and what has historically been good properties to look for. Explains Wall Street's reasoning for those factors and why they are wrong. Where they put a unreasonable premium and what to avoid.
Explains why the higher risk of equities is more than offset by the higher returns in the long run and is really less risk than bonds or Treasuries.
Moves into factors involved in valuing stocks and what has historically been good properties to look for. Explains Wall Street's reasoning for those factors and why they are wrong. Where they put a unreasonable premium and what to avoid.
May 25, 2016
The good thing about reading books years after they were written is that one can judge how accurate the author's predictions were. On that note, Siegel fares badly. Hence the two stars. Stocks have not been such a great investment for the last decade...unless you are heavily skewed towards tech stocks
November 26, 2014
A very good book for anyone who is investing or considering investing, including through a retirement plan at work. That makes it a must read for just about everyone, and it helps put recent market and economic events in perspective.
September 28, 2015
Un buen libro que nos muestra cómo la inversión en acciones es el vehículo de inversión más atractivo en el largo plazo, siempre y cuando se mantenga la paciencia, templanza e inteligencia para elegir buenos stocks
November 4, 2012
Bad scholarship from a permabull.
Displaying 1 - 30 of 158 reviews