<p>newmassdad,</p>
<p>But that’s my point. In the late 90’s, you could pick up a 10K for an internet firm, and still not be able to figure out why it was valued at 400x earnings. It was irrational exuberance that resulted in these high stock quotes, not real book value. This is where behavioral finance comes in. The 90’s were a period of great opportunity for those who realized that prices were absurdly high, just as the early 2000s were a time of opportunity for behavioral finance adherents who realized that prices were too low after the tech crash. </p>
<p>Purchasing CEFs at a high discount when VIX is high is a proven long term strategy (that is used in practice: at Merrill Lynch PBIG they use it every day).</p>