IDEAS home Printed from https://ideas.repec.org/a/ris/jofipe/0015.html
   My bibliography  Save this article

Estimating the Probability of a Lost Decade for U.S. and Global Equity

Author

Listed:

Abstract

This paper estimates the probability of a “lost decade,” where equity investments lose value over a 10-year period. The findings are a reminder that equity investments are risky even over longer time periods, and investors should take this into consideration when making portfolio choices. It also introduces a simple method to allow the reader to combine beliefs about long-run stock returns along with computer simulated return distributions. Finally, the results for the U.S. are augmented with international data which strengthen the case for large long horizon risk.

Suggested Citation

  • LeBaron, Blake, 2013. "Estimating the Probability of a Lost Decade for U.S. and Global Equity," Journal of Financial Perspectives, EY Global FS Institute, vol. 1(2), pages 37-46.
    • Handle: RePEc:ris:jofipe:0015
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    More about this item

    Keywords

    Historical equity returns; Tail risk; Bootstrap;
    All these keywords.

    JEL classification:

    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ris:jofipe:0015. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Ms Alina Stefan (email available below). General contact details of provider: http://www.ey.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.