PT - JOURNAL ARTICLE AU - Dale L Domian AU - William R Reichenstein TI - Long-Horizon Stock Predictability: <em>Evidence and Applications</em> AID - 10.3905/JOI.2009.18.3.012 DP - 2009 Aug 31 TA - The Journal of Investing PG - 12--20 VI - 18 IP - 3 4099 - https://pm-research.com/content/18/3/12.short 4100 - https://pm-research.com/content/18/3/12.full AB - 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&amp;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