- Hardcover: 336 pages
- Publisher: Crown Business (March 8 2005)
- Language: English
- ISBN-10: 140008198X
- ISBN-13: 978-1400081981
- Product Dimensions: 16.3 x 2.5 x 24.1 cm
- Shipping Weight: 567 g
- Average Customer Review: 5 customer reviews
- Amazon Bestsellers Rank: #22,519 in Books (See Top 100 in Books)
The Future for Investors: Why the Tried and the True Triumph Over the Bold and the New Hardcover – Mar 8 2005
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"The constant pursuit of growth--through buying hot stocks, seeking out the next big thing, or investing in the fastest growing countries--dooms investors to poor returns." So states Siegel, an academic who, with optimism and extensive research, suggests that the future is bright for equity investors in old, reliable companies in slow-growth or even shrinking industries. He presents a framework for understanding world markets and offers strategies for protecting and enhancing long-term capital. Stocks will outperform bonds and other inflation hedges, and he recommends supplementing indexed portfolios using three directives--buy stocks that have sustainable cash flows and return these cash flows to the shareholders with dividends; recognize the economic power shifts from the West toward China, India, and the rest of the developing world; and accumulate shares in firms with reasonable valuations relative to their expected growth while avoiding trendy investments. Warren Buffet, the preeminent investor, suggests that those interested in investments should study Siegel's new facts and ideas. Mary Whaley
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“Jeremy Siegel has done us a great service with his superb work. While no one can predict the future of stocks with certainty, Siegel’s analysis marks the verdict of history: the triumph of the shareholder over the shareflipper, the investor over the speculator, the builder over the gambler. Strong conclusions, good writing, and a refreshing message make this a compelling and important book to read.” —Jim Collins, author of Good to Great and co-author of Built to Last
“Jeremy Siegel’s lively new book is much more than a typical Siegelian guide to asset allocation. It is a masterful, provocative, fact-stuffed, commonsense, and creative guide to profitable stock-picking strategies. Even the most cynical and experienced investors will gain from reading Siegel’s latest contribution to their well-being.” —Peter L. Bernstein, author of Against the Gods: The Remarkable Story of Risk
“Jeremy Siegel is a wise man and an astute observer of the ever-changing investment universe. The Future for Investors is essential for the professional and serious amateur investor to navigate the new era.” —Barton M. Biggs, managing partner, Traxis Partners
“The professor who taught America to love stocks in the 1990s is as optimistic as ever. But he’s added a new twist to his theory: Get dividends.” —Money magazine, December 2004
“Siegel thinks about the future in a unique and original way, with insightful thoughts about the broad sweep of history as well as hard-headed investment analysis.” —Robert Shiller, author of Irrational Exuberance and The New Financial Order
“The ‘Wizard of Wharton’ weighs in on the markets ahead. . . . Deeply committed to understanding the macro-financial sector and its constant change has made him an outstanding teacher for [those] who hunger for his brand of forward-looking economics as they apply to the markets.” —Stocks, Futures & Options magazine, September 2004
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Anyone who enjoyed Stocks for the Long Run will find this book to be a very valuable addition to his or her knowledge about stock investing for tax-deferred investment accounts.
Professor Siegel has checked history again. This time he has looked for ways to do stock investing that have performed better than indexed mutual funds for tax-deferred accounts.
Much of what he finds is counter to the conventional wisdom, but makes sense when examined objectively.
Here are some key findings:
1. High dividend yields, when reinvested in the same stock, provide superior returns. That's only true in a tax-deferred account, of course.
2. Buying stocks with low multiples that grow faster than expected is much easier and more profitable to do than simply choosing companies in fast growing industries.
3. Exciting new companies make lots of money for founders, employees and venture capitalists . . . but not enough for investors.
4. Avoid capital intensive businesses.
5. The most productive companies are those who develop new business models (something I discuss in The Ultimate Competitive Advantage) regardless of how bad the industry is.
6. Beware of excessive valuations . . . no matter how good the future looks.
7. If a company has neither a high dividend nor any cash, assume something's wrong with the accounting.
8. Indexed stocks in slower-growing emerging markets have high potential to deliver huge gains in the future due to demographic influences.
From these findings, Professor Siegel suggests a model portfolio for equities that will intrigue you (see page 254) with high-dividend ideas, global firms, attractive sectors and interesting value plays.
In addition, Professor Siegel addresses the question of what to do about paying for the retirements of all those Baby Boomers around the world. His proposal is to encourage young emerging market workers to purchase the assets of older workers in the developed world. You'll find the argument to be intriguing and compelling.
I cannot remember reading a more stimulating and original book about investing. I was particularly impressed by his historical research that shows the superiority of sticking with companies that have been around a long time rather than searching out newer companies to buy. I think the exception to the latter comes in those cases where the management has proven to be adept at improving upon their business models to provide more value to customers.
Almost every investor would benefit from reading and thinking about this book.
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