A Wealth Track Interview with Lubos Pastor

Lubos Pastor is a popular finance professor at the University of Chicago Booth School of Business.

In this interview, Professor Pastor challenges the conventional wisdom, popularized by Jeremy Siegel and others, that stock market risk decreases at longer time horizons.  He also has some interesting comments on human capital, diversification, and market efficiency.

In my opinion, Pastor’s argument about risk and horizon is a bit subtle, and it is difficult to convey in this type of an interview.  I’ve included a few links for those who want to explore this idea more thoroughly.

Original Pastor-Stambaugh Paper

Fama-French Discussion of Pastor-Stambaugh Result

Previous blog post on shortfall probability with equity premium uncertainty

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