What is Hulbert Rating?

481 reads · Last updated: December 5, 2024

A Hulbert rating is a score that tracks the performance of an investment newsletter over time. Investment newsletters are paid subscriptions that can offer investors a variety of market-related information, such as trading strategies, stock recommendations, and economic commentary. Some newsletters focus on specific industries or types of trading, such as options trading, investing in utilities, precious metals investing, or cryptocurrency investing. Hulbert Ratings, LLC assigns Hulbert ratings and encourages investors to judge a newsletter by its long-term performance adjusted for risk.

Definition

Hulbert Ratings are scores used to track the performance of investment newsletters over time. An investment newsletter is a paid subscription service that provides market-related information such as trading strategies, stock recommendations, and economic commentary. Hulbert Ratings, assigned by Hulbert Ratings, LLC, encourage investors to judge a newsletter based on its risk-adjusted long-term performance.

Origin

Hulbert Ratings were created by Mark Hulbert, who began tracking and analyzing the performance of investment newsletters in 1980. Hulbert's work provides investors with an objective way to assess the effectiveness and reliability of different investment newsletters.

Categories and Features

Hulbert Ratings primarily focus on the long-term performance of investment newsletters, particularly their risk-adjusted returns. This means the ratings consider not only the return rate of the newsletters but also their volatility and risk levels. A notable feature of Hulbert Ratings is their independence and objectivity, as they do not rely on data provided by the newsletters themselves.

Case Studies

A typical case involves an investment newsletter that has maintained a high Hulbert Rating over the past decade due to its stable performance during market fluctuations, offering high risk-adjusted returns. Another case is a newsletter that initially performed well but saw its Hulbert Rating decline over time due to its failure to adapt to market changes, highlighting the need for investors to continuously evaluate newsletter performance.

Common Issues

Investors often misunderstand Hulbert Ratings as merely an assessment of return rates, overlooking the importance of risk adjustment. Additionally, some investors may overly rely on a single Hulbert Rating without considering other market factors or personal investment goals.

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