The Inefficient Stock Market and The New Finance

Haugen spent a career arguing against the efficient market hypothesis from inside finance academia, which is roughly as comfortable as it sounds. His evidence was that low-volatility stocks and cheap stocks kept outperforming what the theory said they should, consistently, for decades.

He largely lost that argument while he was alive and he has been substantially vindicated since, and both of those facts are worth sitting with. The consensus in a field full of very intelligent people, with enormous amounts of money riding on being right, was wrong about something central for about thirty years.

I do not read him for the stock conclusions. I read him because he is a case study in how long a wrong consensus can hold when everybody in the room was trained by the same people.