Stock Picks for 2014!

This will be our third consecutive year of picks for the Financial Uproar stock picking contest.  Here's a brief recap of our past performance... which is not impressive, considering the bull regime we're currently living under. 2012 Picks - 17.8% Return - S&P 500 Return: 16.0% 2013 Picks - 9.7% Return - S&P 500 Return: 32.39% A Change … [Read more...]

Wilshire 5000 Dividend Reinvestment Calculator

Below is a calculator which gives the dividend reinvested return of the Wilshire 5000 between any two arbitrary dates since December of 1970.  It uses data from Wilshire Associates, collated by the St. Louis Fed here and here. The Wilshire 5000 is an index produced by Wilshire Associates which better measures the total United States stock market … [Read more...]

2013 S&P Return

We include dividends. 32.39% was the S&P 500 return for 2013, not the 29.60% you'll see quoted on tons of other sites. We told you last year, but we'll obnoxiously repeat the lesson once again: dividends matter.  While every other web site on the internet gives you the price returns of the S&P 500, we do the extra step and tell you … [Read more...]

Expected Real Returns on BAA, AAA, and 10 Year Treasuries

If you recall, in our last article we calculated historical risk spreads between various asset classes.  Not content to leave that topic in an unfinished state, here's the results of some further calculations - this time looking at debt vis-a-vis itself - we compare last week's asset classes to inflation expectations at the time... (Oh, you … [Read more...]

The Risk Spread Premium – (Almost) A Century of Data

A recent comment on one of our CAPE articles recently sent us digging for data on the long term perception of risk in the market.  For our purposes, we're interested in risk tolerance and, specifically, the difference in yields between various forms of debt.  Why is that important?  Well - we could argue all day about valuations in the stock market … [Read more...]

More on Shiller’s CAPE vs. The Ten Year Treasury Yield

We recently covered (graphically, anyway) the relationship between the Ten Year Treasury Yield, Shiller's CAPE (inverted) and the S&P 500 Index.  Although it was sort of possible to estimate the returns that followed, we'd be a bit uneasy if we forced you to do too much squinting - truly, you don't want your eyes to end up like mine.  If that … [Read more...]

Shiller CAPE vs. Ten Year Treasury Yields

We recently finished a five piece epic series on total stock market valuations - a task which will pay dividends for quite a while in questions and new article ideas, it seems.  Recently, our friend Jordan asked about how Treasury yields (or, specifically, 'zero risk' investments) affect valuation on the stock market in general.  Let's take this … [Read more...]

Inflation and Dividend Adjusted S&P 500 Performance

Back in March, we here at Don't Quit Your Day Job... reported the actual all time high in the S&P 500 using the only methodology that matters - adjusting for inflation and reinvesting dividends.  Since there was a fair bit of excitement (and bubble talk!) when the NASDAQ closed over 4000 on Tuesday for the first time since September 7, 2000, … [Read more...]

Stock Cash Flow and Dividend Analysis Calculator

Two methods which are often used to guess the underlying value of a stock are the discounted cash flow analysis and the dividend discount model.  Since ownership of a stock is a claim on future earnings, discounting that cash into the future is one way to get a hold on what a stock is 'worth' according to your estimates. This calculator uses … [Read more...]

Is the Stock Market Overvalued? The Finale.

This is the end... my only friend.  The end. We've taken you on a journey in the last 4 pieces - everywhere to academia to Omaha to main street - just to bring you back here with that same question burning in your brain. "Well, is the market overvalued?" you may still be asking, or "what does all of this mean?". I'm not cruel enough to … [Read more...]