I’ve posted Entry #100 to my weekly Beyond Buy-and-Hold column at the Out of Your Rut site. It’s titled The Extent to Which Valuations Matter Is Highly Counter-Intuitive.
Juicy Excerpt: Look at the 30-year numbers. The Red Bar for Scenario One (a low starting-point valuation) ends at $1,190,150. That’s the value of the portfolio in the worst possible case, considering every return sequence we have seen in the historical record. The Red Bar for Scenario Two (a high starting-point valuation) is $560,680. That’s less than half. In a worst-case scenario, your $200,000 will at the end of 30 years be worth more than double if valuations were low at the start of the 30-year time-period.