Post #4054 by rayvt on the Mechanical Investing board

Investment Strategies / Mechanical Investing ❤

Unthreaded | Threaded | Whole Thread (45)

Post New | Post Reply | Report Post | Recommend It!

No. of Recommendations: 5

One thing interesting about the scatterplot is that BRK-A doesn't have very much time, overall, with a negative CAGR and being above its 4-yr SMA, and none at all when it's below its 4-yr SMA.

Yes. The sweet spot for this 4yr/2yr screen is 0% to about 70% above the 4 year SMA. Very few negative returns. There have been a lot of high returns in the +20% to +30% range.

I had never thought about it, but this plot shows that when the price is way way above the SMA it is a very bad time to own BRK. I had to recheck some of those datapoints to verify them.
What that is, is times when BRK shot to the moon, like doubling in 4 years, and it headed for a comeuppance and a drop down to more rational prices.

The 4 years beginning 5/1994 it went from $16,000 to $78,000.
Then fell to $51,000.

Maybe BRK-A has been a good buy for a while
So it would seem. It's been right in the range where there have been quite good returns.

Post New | Post Reply | Report Post | Recommend It!

Print the post

Unthreaded | Threaded | Whole Thread (45)

Prev | Next

Announcements

Mechanical Investing FAQ

Contact Shrewd'm
Contact the developer of these message boards.

A community forum supporting civilized, and highly helpful, self-educating investors that come together for Shrewdness and merry spirits. These message boards closely follow the look and feel of the old message boards at boards.fool.com prior to the boards redirected to discussion.fool.com. Shrewd'm is not affiliated with the comprehensive and excellent investment website, The Motley Fool (TMF), in any way. The Shrewd commmunity here has owed, and continues to owe, gratitude to The Motley Fool for nurturing a culture of jovial irreverence towards Wall St, and that tradition will continue here.