Solution: Blind Trust

[Peter_Puget]

Link

 

US senators' personal stock portfolios outperformed the market by an average of 12 per cent a year in the five years to 1998, according to a new study.

 

"The results clearly support the notion that members of the Senate trade with a substantial informational advantage over ordinary investors," says the author of the report, Professor Alan Ziobrowski of the Robinson College of Business at Georgia State University.

 

He admits to being "very surprised" by his findings, which were based on 6,000 financial disclosure filings and are due to be published in the Journal of Financial and Quantitative Analysis.

 

"The results suggest that senators knew when to buy their common stocks and when to sell."

 

First-time Senators did especially well, with their stocks outperforming by 20 per cent a year on average - a result that very few professional fund managers would be able to achieve.

 

"It could be argued that the junior senators most recently came out of private industry, so may have better connections. Seniority was definitely a factor in returns," says Prof Ziobrowski.

 

There was no difference in performance between Democrats and Republicans.

 

A separate study in 2000, covering 66,465 US households from 1991 to 1996 showed that the average household's portfolio underperformed the market by 1.44 per cent a year, on average. Corporate insiders (defined as senior executives) usually outperform by about 5 per cent.

 

The Ziobrowski study notes that the politicians' timing of transactions is uncanny. Most stocks bought by senators had shown little movement before the purchase. But after the stock was bought, it outperformed the market by 28.6 per cent on average in the following calender year.

 

Returns on sell transactions are equally intriguing. Stocks sold by senators performed in line with the market the year following the sale.

 

When adjusted by the size of stocks, the total portfolio returns outperformed by 12 per cent a year on average. The study used a total market index as the benchmark for comparison.

 

The study took eight years to complete because there was no database of information and the documents had to be gathered and examined manually. Stocks held in blind trusts are not included in the disclosure documents.

[MrDoolittle]

...and this is why I'm voting for Nader...

[Greg_W]

...and this is why I'm voting for Nader...

 

I'm sure the Republican National Committee is very pleased for your contribution to the re-election campaign of George W. Bush.

[burgersling]

Just this?

[MrDoolittle]

Just this?

 

Yes. This is the single most important issue for this year's election. The future of humanity lies in the balance.

[iain]

[J_Fisher]

...and this is why I'm voting for Nader...

 

Doolittle, before you vote for Nader on that basis, you ought to do a little research. His own financial shanigans, including shorting companies he's about to attack other market manipulation type stuff have been well documented for years.

 

http://dir.salon.com/politics/feature/2000/10/28/stocks/index.html

 

http://www.realchange.org/nader.htm

[Blake]

IMO Nader really speaks out on important and ignored issues, but he does have some skeletons in his closet too. However, I am pissed as hell at all teh idiot Gore apologists who can't stop crying about how Nader stole the election and blah blah blah. WE deserve a variety of choices and options, that's how democracy works. Seriously, if you don't win the election get over it!

[archenemy]

I think you are seeing how democracy actually works when reading the posted article. I do wish it worked by us voting people into office and them doing some good; but really, who are those assholes? They are the new royalty and don't really give a shit about the average joe. Maybe rather than rely on these losers, we can get together and get some things done on our own (i.e. Access Fund in a larger sense). Maybe I'm just a dreamer, but I can't help but think that there must be a better way...

[Lars]

amazing how the ones who cry about Nader as the cause of Gore's loss in 2000 had no problem when Perot did the same thing for Bush, helping Clinton to win in 1992.

 

just another double standard from the liberal idealogues.

[chucK]

People cry when they lose, and gloat when they win. Calling that a "double standard" is an idiotic statement .

[archenemy]

Some people do know how to win graciously and lose with sportmanship. You shithead.

[chucK]

What's your point? Still ain't a double standard.

[archenemy]

no point.

the double standard comes in when people expect others to be gracious or show sportsmanship and then they themselves don't do so.

still no point.

[Peter_Puget]

FYI Here is an example of a double standard: The Hollywood elite saying how bad the black listing was of communists during the cold war and the same elites threatened blacklisitng of Mel Gibson. Read Entertainment Weekly 2/17 edition or NYT Magazine.

 

Sad but typical liberal behavior.

[j_b]

Some people do know how to win graciously and lose with sportmanship. You shithead.

 

errrrr, the democrats did not loose the 2000 elections. sorry to have to remind you of this fact. moreover to invoke 'graciousness' and 'sportmanship' after having been exposed to conservative bile throughout the clinton years is irony at its finest.