I believe I've passed the age of consciousness and righteous rage. I’ve found that just surviving was a noble fight. I once believed in causes too. I had my pointless point of view. And life went on no matter who was wrong or right. - from Billy Joel's "Angry Young Man" Life advice from the [...]
How did the DJIA perform in 2016? What were the drivers? How does that compare over the trailing 10 years? Let's have a look...
The typical investor is almost always his/her own worst enemy. Overconfidence, behavioral biases and emotional decisions conspire to ensure investment returns trail not only most major asset classes but even inflation. Consider the ROR of the average investor over the past 20 years: 2 SOURCES: JPMorgan Asset Management, Barclays, FactSet, S&P, Dalbar. 60/40 and 40/60 [...]
Advice from the SEC’s Office of Investor Education and Advocacy to help investors make better informed investment decisions and avoid common scams in 2017: Always check the background of an investment professional—it is easy and free. You can find details of an investment professional’s background and qualifications through the search tool on the SEC’s website [...]
Religion and politics are not to be discussed in polite company. We get it. But indexing? It seems few topics draw the ire of the zealots and ideologues. Indexing is but a tool. It’s neutral. It has its pros and cons. It has its place. But to blindly marry oneself to an ideology? We are [...]
Passive investing (i.e. indexing) has been beaten into our heads as the “best” method of achieving our investment goals. There’s a lot to like. Internal operating expenses are low and, generally, most actively-managed funds cannot beat or exceed their benchmark. So why not index? Here’s the inconvenient truth. Investors focusing solely on cost and return [...]
Are advisors worth their fees? Research shows the answer is a resounding “yes,” albeit not for the reasons you might have supposed. Find out why here.
The results of a recent poll by the CFA Institute exhibit interesting findings regarding our bias towards ownership – the so-called Endowment Effect. A full 84% of respondents indicated selling is tougher than buying. The most emotionally taxing decisions are outright sales (43%) followed by short sales (41%). Buying on margin (13%) came in third. [...]
Our caveman ancestors had a simple test for survival – Fight or Flight. In our modern world money is the source of survival. As a result every primitive survival and pleasure-seeking drive is intensely focused on capturing and guarding money. These drives are involuntary and highly emotional emerging more quickly and forcefully than logical analysis. [...]
It’s been a while since we’ve yelled at those darn kids to stay off our lawn so it’s time to complain: What was up with all the gasbags on Friday? Great Britain voted to leave the European Economic Union and with nary a thought appeared article after article proclaiming to know what it means and [...]