Given that it's been a year, I thought it might be fun to update this thread with Mr. Hussman's performance in that time. And...[drumroll, please]...the Hussman Strategic Growth Fund is down 20% in that span while the S&P is up 31%. This despite his claiming last year at this time that his investors should:
"understand the adaptation we introduced in late-2017. In my view, it addresses the central feature of the financial markets that made our experience between 2009 and 2017 so different from our experience in complete market cycles prior to 2009, and different from what we expect in future cycles – even if extraordinary monetary and fiscal interventions become the norm."
In other words, he supposedly fixed what was wrong with his investment approach. And yet, in the past year his investors lost a fifth of their money while passive indexers gained nearly a third of theirs. Gotta wonder how this guy still has any assets under management.
More recently, he placed some of the blame for his fund's awful performance on passive indexing, sharing this deep thought:
"...one can visualize an efficient market as a sheep standing on a nickel. If there are enough sheepdogs around, constantly ensuring that the sheep doesn’t stray, then yes, the sheep will keep standing on the nickel. But if the sheepdogs simply assume that sheep always stand on nickels (the equivalent of asserting that “low-cost index investing is always efficient”), the sheep may not even stay in the neighborhood. That is the situation that the performance-chasing popularity of index investing has created today."
In addition to the negative returns, people pay up to 2% a year for these kinds of insights and results.
