Very interesting article in the March 5 issue of Fortune on page 129:
The article-“Sometimes The Worst Are First” flies in the face of those professionals who continuously preach to the masses to buy good companies (of course they have little-to-no statistical evidence as to why one should buy those stocks). From 1983-2006, Fortune’s annual list of “Most Admired Companies” has under performed their list of “Least Admired Companies”. The most admired companies returned 15.4%; the least admired returned 17.8%, 6.6% above the S&P 500.
The study was done by Meir Statman (great last name), a professor of behavioral finance at Santa Clara University along with another professor and Ken Fisher of Fisher Investments. Here’s the study for your knowledge and enjoyment:
http://lsb.scu.edu/finance/faculty/statman/articles/fortune030207.pdf
