If you have not read the recent letter of Jeremy Grantham, the co-founder of GMO and renowned investor, you will regret it later, considering that his detailed sketch of bubbles in equity markets answers critical questions about the recent rally in terms of why and how it has formed and what could lead to its puncture.
More importantly, while he, like any other sensible investor, denies how difficult it is to time the market, it provides a good sense of when this bubble could deflate as well as tells us how we can prepare during times of uncertainties.
If you want to have a Quick Glance of important takeaway from the letter, download the original document from the below link...
You can also write us at 100bagger.com@gmail.com in case you are unable to download the marked PDF file.
Here is an "Executive Summary" we captured from the latter.
The long, long bull market since 2009 has finally matured into a fully-fledged epic bubble. Featuring extreme overvaluation, explosive price increases, frenzied issuance, and hysterically speculative investor behavior, I believe this event will be recorded as one of the great bubbles of financial history, right along with the South Sea bubble, 1929, and 2000.
These great bubbles are where fortunes are made and lost – and where investors truly prove their mettle. For positioning a portfolio to avoid the worst pain of a major bubble breaking is likely the most
difficult part.Every career incentive in the industry and every fault of individual human psychology will work toward sucking investors in. But this bubble will burst in due time, no matter how hard the Fed tries to support it, with consequent damaging effects on the economy and on portfolios. Make no mistake – for the majority of investors today, this could very well be the most important event of your investing lives.
Speaking as an old student and historian of markets, it is intellectually exciting and terrifying at the same
time. It is a privilege to ride through a market like this one more time.
If you want to have a Quick Glance of important takeaway from the letter, download the original document from the below link…
You can also write us at 100bagger.com@gmail.com in case you are unable to download the marked PDF file.
About Jeremy Grantham
Jeremy Grantham co-founder of GMO is the renowned investment strategies, who rightly identified and predicted many of the previous global stock market bubbles such as tech bubble of 2000 and sub-prime crisis of 2008.
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