The academic paper published in the past few years that most impacted my investment philosophy was Henrick Bessembinder's "Do Stocks Outperform Treasury Bills?" We know that the simple answer to the titular question is a resounding "yes." Over long-time intervals, the equity market has, on average, paid an investor a premium for taking equity risk.
In tracking nearly 26,000 stocks, Bessembinder found that a whopping 58% of stocks failed to outperform Treasury bills over their lifetimes in a long-term dataset, stretching back to 1926. On average, stocks outperform over long-time intervals, but the