I think I used to own that one in a 403b years ago. Got out before the '08-'09 Crash, for which no one has gone to jail.
http://quotes.morningstar.com/fund/f?t=ARYVX

What stands out to me is he is negative over the past 1, 3, 5, and 10 years (HSGFX) Not exactly my idea of building wealth.

Also calling him a perma bear is also wrong.

I'd say that's accurate when you look at Hussman as a whole. The media has taken to making villains out of/shouting down anyone who has tried to bring a little reality into the discussion. They did in 2007/2008, too, to anyone who questioned the sustainability of the situation ("Housing might crash? How dare you say such a thing!")
I really dislike Hussman's positioning (this whole overly complex and unnecessary completely hedged long portfolio.) If he feels the way he does, go heavily to cash and staples, with some light hedging if need be. Simpler strategy (given his views) and would have likely done better. I think there is a stubbornness in keeping with the portfolio positioning.
Additionally, calling the stock market a bubble and being long thing like Panera, Starbucks and Viacom? Meh.
"He is a hedger not a shorter"
The portfolio - last I looked - remains fully hedged. So, either his hedging strategy is not working or his long portfolio is underperforming or some combination of both, although I'm thinking it's the former more than the latter. I think we've gone over this before and I forget what the result was, but I'd be curious what Hussman's unhedged performance would have looked like over the last 2-3 years.

I just had a fresh look at Hussman's record with what seems to be his most important fund, HSGFX
Actually, he did amazingly well from inception on 7/24/2000 thru the end of 2008.
His 2001 and 2002 performances were exceptional. Most funds were taken to the cleaners in 2002. The Vanguard S&P 500 index fund lost 22% in 2002, and lost 12% in 2001. For Hussman to have been up more than 14% in each of those years is really something.
From inception thru the end of 2002, unbelievable performance.
2003-2007, lukewarm.
2008: Exceptional, considering the S&P 500 went down 37%
From 2009 till the present: unbelievably bad performance.

What's so unique about Hussman is his academic credentials. It's one thing to hear a charlatan say the Dow is going to 6,000 and the sky is falling. It's a bit different when someone with a PhD in economics from Stanford, who had an exemplary mutual fund record for almost 9 years, writes the kind of stuff Hussman writes.

Even a blind squirrel will find an acorn once in a while. So will Hussman be 'proved right' at some point. In the meantime, his disastrous management has cost shareholders dearly. It is amazing his Strategic Growth fund has any assets at all, let alone more than $1 billion (but down from $6 billion in 2010). His claim to fame was performance in the 2007-08 bear market. Perhaps he will do well in the next bear market, but there are other low-risk options for investors that have at least had a positive return the last 10 years.

It is beyond me why Janus Overseas gets any positive commentary. It's at the bottom of the heap over the last 3 and 5-year period. While I understand it has chosen to load up on emerging market stocks, my guess is that very few folks who own the fund, and certainly those who bought it years ago and for some strange reason still own it, understand this fact and the huge risks that come with it. It's one thing to have a 10-20% allocation to EM stocks like ICEIX, which has a remarkable record since John Maxwell took over the fund. But Janus, with a very cloudy history anyway, is going a completely different route. Interesting that M*, which is so quick to re-classify some funds (often incorrectly), has kept JAOSX in the Foreign Large Blend category, when it has been heavy EM for quite some time.

Of course, the big disadvantage with REITS is that you are investing in the stock market. Whereas one of the main attractions of real estate is getting an alternative asset class to stocks and bonds.

That is true, although I think they're both risk assets and are going to move South if things go South. Although owning both provides some diversification, the REIT is at least a very liquid asset whereas the real estate is not.
It's almost difficult to consider real estate an investment at this point, or at least maybe that should not be the focus/priority that much anymore. My only thought about real estate is this: I think what works over the next 10 years is convenience. Close to transit and amenities (grocery, etc.) This whole thing of houses in the middle of nowhere where you have to drive to do anything will be less appealing, especially if energy prices stay around these levels or head much higher. Other than that, who knows what house prices will do over the next decade.

I think the only thing investorz should be concernex about is the next 5 years in this fund. I would sell 1nd i think it would be the right thing to do

FYI Hussman’s funds have missed out on much of the strong equity gains in recent years, prompting some criticism of his investing style. The Hussman Strategic Growth Fund HSGFX is down 1.5% this year, compared to 7.2% gains on the S&P 500 index SPX , according to Morningstar. The other funds have fared a bit better: The Hussman Strategic Total Return Fund HSTRX is up 6.8%. The Hussman Strategic Growth Fund HSIEX is up 1.9%, while the Hussman Strategic Dividend Value HSDVX is up 0.2%.
Regards,
Ted
http://blogs.marketwatch.com/thetell/2014/07/27/this-stock-bubble-is-beyond-1929-and-2007-says-john-hussman/tab/print/

I still go back to the elder Baron Rothschild saying that to be safe, one should have 1/3 of their wealth in securities, 1/3 in real estate and 1/3 in 'rare art'. We'll call rare art = collectibles. I'm good with this. Gees, i's been 7-8 years since I first read this and I'm still not at 33/33/33. That's OK. I'm close enough that it really doesn't matter much on the margin.
No one has shown me a better plan.
peace,
rono

For those who don't own any real estate, do you all think REIT mutual funds are a good substitute?

Hi Doc, Mo,
Hope you and yours are both doing well.
These figures don't surprise me at all. Equities are always where the good gains lie. Collectibles, as they were, are more of a wealth preservation hedge.
I still go back to the elder Baron Rothschild saying that to be safe, one should have 1/3 of their wealth in securities, 1/3 in real estate and 1/3 in 'rare art'. We'll call rare art = collectibles. I'm good with this. Gees, i's been 7-8 years since I first read this and I'm still not at 33/33/33. That's OK. I'm close enough that it really doesn't matter much on the margin.
No one has shown me a better plan.
peace,
rono

It's a bad practice that leaves a bad taste in customers mouths. Some years back I had to turn a airline ticket of $350 in for a refund. The airline, Northwest Orient, charged me a refund fee of $75.
No matter which industry it is, when they charge you to give back your own money it is extortion as Crash stated. Some banks do it through fees to process your money. Sounds more like gangster tactics.

FYI: For years, there have been two principle adjectives used to describe the buy-and-hold investment style: Dead or alive.
Regards,
Ted
http://www.marketwatch.com/story/buy-and-hold-is-impossible-2014-07-25/print?guid=661C4676-140D-11E4-A7DB-00212803FAD6
In case you missed Chuck's Show and the Andrew Lo interview on 7/25/14:
http://www.mutualfundobserver.com/discuss/discussion/14687/chuck-jaffe-s-money-life-show-7-24-14-guest-andrew-lo-mit-bob-auer-manager-auer-growth-fund#latest

FYI: Copy & Paste 7/26/14: Lawrence C. Strauss; Barron's
Tiny gain in first half follows years of annual losses for hedge funds and mutual funds in this sector.
Regards,
Ted
Many hedge funds specializing in managed futures have struggled with poor performance, to put it mildly.
After shining during the financial meltdown of 2008 -- the HFR index tracking these funds returned an impressive 18.06%, versus a 37% loss for the Standard & Poor's 500 that year -- these funds have fallen on hard times. On average, they lost 3.54% in 2011, followed by negative performances of 2.51% and 0.87% in 2012 and 2013, respectively.
As a result of this persistent underperformance, net outflows surged to nearly $6 billion in the first half of 2014, according to HFR. "Financial advisors are having a hard time persuading their clients to stay with it," says the manager of a large fund of funds.
MANAGED-FUTURES FUNDS' ASSETS total about $230 billion, or roughly 8% of the $2.8 trillion invested in hedge funds, according to HFR. The good news is that there are small signs of an improving environment for these funds, which tend to be helped by more volatility and a macro environment in which there's a lot of divergence among asset prices. The unwinding of the Federal Reserve's quantitative-easing program should help. In the first half, the average return for managed-futures funds was 0.37%. That's not great, but it's better than it has been in the recent past.
These funds rely heavily on futures contracts, usually to make calls on the direction of stocks, bonds, currencies, or commodities. Often with the help of computer algorithms, managers try to identify trends -- whether it's rising interest rates or declining gold prices. AQR Funds describes it in a recent shareholder letter as going long markets whose prices are rising and shorting those with falling prices.
For managers who can correctly identify trends ahead of the pack, so much the better when it comes to performance. Especially good scenarios are when markets are going from good to very good or from bad to worse, as was the case in 2008. Later that year, stocks and commodities tanked, while gold and Treasuries rallied. All of which led to a stellar performance that these funds haven't come close to repeating.
One of the trend-following strategy's selling points is that it's a good way to diversify a portfolio, thanks in part to low correlations to traditional assets like stocks and bonds. But with equities doing so well in recent years, many of these funds have been passed by. However, Pat Welton, co-founder of Welton Investment, which runs managed-futures strategies, points out that many of these managers don't take large positions in equities because "it's exactly what you've been hired to diversify away from." In addition, when markets flatten out -- as has been the case with interest rates, for example -- it's harder for managers to find trends and exploit them.
Yao Hua Ooi, a portfolio manager of the $6.2 billion AQR Managed Futures Strategy fund (ticker: AQMNX), points to "how far you look back to determine whether a market is trending up or down" as a key factor. In the past few years, managers who use longer time horizons -- say at least a year -- have fared better than those who use a shorter window, typically one to three months, he observes. The AQR fund's managers blend shorter and longer time horizons to gauge trends, he adds.
As if to illustrate how challenged performance has been for these funds, AQR Managed Futures Strategy has a three-year annual return of 1.2%, placing it near the top of its Morningstar category. It's a mutual fund, not a hedge fund, with an expense ratio of 1.50% -- pricey for a mutual fund but considerably cheaper than a typical hedge fund.
Welton attributes these funds' performance difficulties to the flood of liquidity by central banks around the world, more or less in unison for many years. Low interest rates have been accompanied by lower spreads, making it hard to find good trends to follow, he adds.
AN 18.73% RETURN in 2010 for the Welton Global Directional Portfolio was followed by three straight years of negative results, triggering outflows. In this year's first half, however, the fund was up 17.41%, having made money in equities, commodities, interest rates, and currencies. The portfolio also had success with so-called relative value strategies, an example of which would be going short one basket of stocks, while being long another.
Several firms have studied the dismal performance of managed futures. Ooi, of AQR, contributed to a paper on that topic. With the help of financial simulations -- these funds weren't around in, say, the 1920s -- the paper concluded that "trend-following has delivered strong positive returns and realized a low correlation to traditional asset classes each decade for more than a century." Adds Ooi: "Just like any investment strategy, it has had underperformance, but that isn't predictive that the strategy will no longer generate returns going forward."
Most of managed-futures funds, however, are in crying need of a sustained stretch of good performance -- and sooner rather than later.
M* Snapshot Of Managed Futures Fund Returns: http://news.morningstar.com/fund-category-returns/managed-futures/$FOCA$13.aspx

FYI: Copy & Paste 7/23/14: Jason Zweig: WSJ;
Regards,
Ted
include a tribute to the late Peter L. Bernstein. Few things have given me greater professional and personal pleasure than having been able to call Peter my friend.
Peter, who died five years ago at the age of 90, spent nearly six decades on Wall Street. He also worked at the Federal Reserve, taught economics at Williams College, toiled as a commercial banker, ran an investment-counseling firm, and consulted on economics and investing strategy with some of the world’s largest money managers. He was the founding editor of the Journal of Portfolio Management, which took as its mission to make investing as close to a science as the theory and the data would permit. He wrote nearly 20 books, including the twin masterpieces Capital Ideas, his history of how modern financial theory transformed investing, and Against the Gods, probably the best popular book ever written on risk.
Like most people who knew him, I regarded Peter as the philosopher-king of Wall Street, the man who had read everything, knew everyone, and had thought longer and deeper about the hardest puzzles than anyone else.
Yet the central lesson that emerged from Peter’s life and work was intellectual humility, not hubris. The more he learned, the more skeptical he became of his—or anyone’s—ability to predict the future.
Insatiably curious, Peter never stopped learning, and his favorite word when confronted with something he hadn’t yet thought of was “Wow!”
I think of him as the modern equivalent of the sages described by the great French essayist Montaigne:
“To really learned men has happened what happens to ears of wheat: They rise high and lofty, heads erect and proud, as long as they are empty; but when they are full and swollen with grain in their ripeness, they begin to grow humble and lower their horns.”
Again and again, Peter would marvel that he could “make a living by reminding people of what they know only too well already.”
In 1999, I was thrilled when Peter asked me to write a guest essay for his newsletter. (To avoid any conflict of interest, he didn’t offer, nor did I request, any compensation for writing it.) For my topic, I chose the challenge that professional money managers faced in trying to take a long-term perspective in an increasingly short-term world.
We titled it “The Velocity of Learning and the Future of Active Management.” Fifteen years later, the topic seems at least as relevant (click here to download the PDF).
In 2004, I drove up to Peter’s summer house in Brattleboro, Vt., to do a long interview. We talked for nearly four hours about everything from John F. Kennedy (Peter’s classmate in the Harvard College class of 1940) and Peter’s experiences as an intelligence officer during the London blitz in World War II to the problems of 401(k)s and the puzzle of why companies pay dividends.
Together, he and his wife, Barbara, could be as wickedly funny as classic comedy teams like Burns and Allen or Stiller and Meara. Peter mentioned during that interview that he and his lifelong friend, the economist Robert Heilbroner, had done everything together as children and teenagers. “We even lost our virginity together, at the exact same moment,” he recalled. “Not at the exact same moment, Peter,” Barbara said.
You can click here for part one of my profile of him and here for part two; the PDFs are large files that could take a while to load, but any visit with Peter is worth the wait. A fuller transcript of our long conversation is available here.
Economics And Portfolio Strategy: http://green.lunarbreeze.com/~jason146/wp-content/uploads/2014/07/PLBjz.pdf
Peter's Uncertainty Principle Part 1. http://green.lunarbreeze.com/~jason146/wp-content/uploads/2014/07/11.04PBernstein1.pdf
Peter's Uncertainty Principle Part 2. : http://green.lunarbreeze.com/~jason146/wp-content/uploads/2014/07/11.04PBernstein2.pdf

I'm surprised they listed Triton and Venture which have both been having sub-par years. A few years ago, Triton (JATTX) was one of my largest holdings. I sold it last summer when Brian Schaub and Chad Meade left Janus to work at a hedge fund. Schaub and Meade also ran Venture.

FYI: (Follow Up) According to a new study by S.&P. Dow Jones Indicies, only two out of 2,862 mutual funds managed to attain top-quartile performance for the five years between March 2010 and current day. One of those two funds was the family-run Hodges Small Cap Fund based in Dallas, Texas.
Regards,
Ted
https://screen.yahoo.com/why-mutual-fund-manager-trouncing-154012095.html
M* Snapshot Of HDPSX: http://quotes.morningstar.com/fund/hdpsx/f?t=HDPSX
Lipper Snapshot OF HDPSX: http://www.marketwatch.com/investing/fund/hdpsx
HDPSX Is Ranked # 22 In The (SCB) Category By U.S. News & World Report:
http://money.usnews.com/funds/mutual-funds/small-blend/hodges-small-cap-fund/hdpsx

FYI: Ex-employee alleges low-cost fund provider operated as an illegal tax shelter, avoided about $1 billion in taxes over 10 years.
Regards,
Ted
http://www.investmentnews.com/article/20140725/FREE/140729927?template=printart

From Guggenheim's Macro View
In his famous speech, Martin preceded his punch bowl comment by saying, on behalf of the Fed, “…precautionary action to prevent inflationary excesses is bound to have some onerous effects…” The flipside -- a lack of precautionary action by the Fed -- will have its own set of consequences in time. It is very difficult to say when exactly these will happen, but near-term indicators suggest the hangover won’t hit while you’re relaxing at the beach this summer.
Equity Markets: The Bigger they Come the Harder they Fall
The S&P500 has now gone nearly 800 days since a correction of more than 10 percent – the “meaningful” level for many analysts. The more extended the market becomes, the larger the eventual decline may be. Over the last 50 years, the longer the time between market corrections, the steeper the drop once the correction does occur.(chart)
http://guggenheimpartners.com/perspectives/macroview/the-hangover

Hi John and others,
I agree, we investors who have logged some time and have followed the markets through the years have an awareness of when good value can be had in the markets along with a feeling when valuations have become stretched. Currently, there are spots in the markets where I feel valuations are in bubble territory. One of them is the Russell 2000 Index where I believe the TTM P/E Ratio is in the 70’s. For me, this is just too richly priced and I have recently trimmed my allocation in small caps.
Old_Skeet