%0 Journal Article %A Dale L Domian %A William R Reichenstein %T Long-Horizon Stock Predictability: Evidence and Applications %D 2009 %R 10.3905/JOI.2009.18.3.012 %J The Journal of Investing %P 12-20 %V 18 %N 3 %X This article updates prior studies and presents new evidence on the predictability of stock market returns. It examines the ability of two earnings yields to predict one- through 10-year real S&P 500 returns for 1881–2008 and 1953–2008. The upshot is that, as of year-end 2008, stock prospects look better than they have since at least the early 1990s. Based on evidence from Shiller’s model and a variant of that model, long-horizon stock prospects appear to be in line with historical averages, where stocks significantly outperformed Treasury bonds and bills. Finally, this study discusses investment implications and applications of this research.TOPICS: Factors, risk premia, security analysis and valuation, portfolio management/multi-asset allocation %U https://joi.pm-research.com/content/iijinvest/18/3/12.full.pdf