Edward McQuarrie

Edward McQuarrie

Formal First Name

Edward McQuarrie is a business professor and researcher most notable for his research that cautions against long-term buy and hold strategies

  • His research has shown that bonds have have outperformed stocks over various periods of time (including long periods)
    • Leveraged securities data from Richard Sylla and Jack Wilson to prove this
  • Wrote a paper in 2017 titled "Stock Market Charts You Never Saw"
  • Research shows that there can be long periods where holding on to stocks is a bad strategy.  Example:
    • Assume  buying stocks in 1929
    • The stocks don't return to their same real (after inflation) value until 1957
    • Stocks are later hurt with inflation in the 1970s.
    • By 1975 the real value of the stocks would be lower than the real value back in 1929 
    • The real value of stock only starts making gains in 1985!
    • The crash of 1987 then drove real values down again close to 1929 levels
  • His research has quested that idea that stocks outperform bonds over the long run
  • His response to the idea of "Stocks for the Long Run" is that "it all depends"
  • Doesn't always believe that there is an equity premium.  Stocks can sometimes do better than equities
  • Bonds performed better than stocks during the first few decades of the 19th century

McQuarrie Essays to Read:

  1. The First Eighty Years of the U.S. Bond Market:  Investor Total Return from 1793, Combining Federal, Municipal and Corporate Bonds.

McQuarrie Reasearch Criticisms

  • The historical data he used may not be complete or accurate (some data could be left out)