Do Stocks Outperform Treasury Bills and more with Dr. Hendrik Bessembinder

In this episode of Valley Investors, host Nathan Erickson sits down with Dr. Hendrik Bessembinder, the Francis J. and Mary B. Labriola Endowed Chair at Arizona State University. Dr. Bessembinder shares his unique path from motorcycles to academia, diving into his extensive research on market design, trading strategies, and long-term investment performance. They explore his most famous work, "Do Stocks Outperform Treasury Bills?" and discuss the implications for both passive and active investors. The conversation also covers market trends, retirement planning, and the evolving risks in today's concentrated markets.

 

Key Discussions in This Episode:

[00:00:55] Dr. Bessembinder’s academic journey and love for motorcycles.

[00:02:35] Transition from business school to a PhD in economics.

[00:05:04] Early academic career and corporate experiences.

[00:07:02] Joining Arizona State University in 1989 and the growth of the finance department.

[00:09:59] Shifts in research focus from commodities to long-term stock performance.

[00:12:58] Key findings from "Do Stocks Outperform Treasury Bills?" paper.

[00:19:04] Concentration of wealth in a small number of stocks.

[00:26:30] Risk management and portfolio rebalancing.

[00:31:15] Market efficiency and skewness in stock returns.

[00:36:20] Retirement planning and sustainable withdrawal rates.

 

 

Links:

Arizona State University: https://www.asu.edu/

Hendrik Bessembinder on Linkedin: https://www.linkedin.com/in/hendrik-bessembinder-0537a0298

Nathan Erickson on LinkedIn: https://www.linkedin.com/in/nathanferickson/