I’m trying to do retrospectives on financial predictions as I stumble across them on the Web. Here’s one that turned out correct: @EpicureanDeal said not to buy Blackstone Group when it went public.
“A little knowledge is a dangerous thing.” Like, say, a little knowledge of cool and funky rich people or private equity deals from the paper. I’d rather be financially illiterate than taken hold of this bag.
From 35, to 25, to 15, to 5. Since the market bottom $BX has quintupled which is basically in line with the S&P.
Correlation since 2008 of the S&P to $BX has been 95%, so you can rule out a “complementary growth” argument for the buy.
Reproducible analysis:
require(quantmod)
getSymbols("BX")
chartSeries(BX)
reChart(up.col='yellow', dn.col='light blue', color.vol=FALSE)
getSymbols("SPY")
chartSeries(BX/SPY) #quantmod automatically matches subsets for you!
reChart(up.col='yellow', dn.col='light blue', color.vol=FALSE)
bx <- BX['2008:']
sp <- SPY['2008:']
cor(bx,sp)
