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Archive For: Investing

Majority of Active Mutual Funds Fail, Again

According to the S&P Dow Jones Indices just released results, over the one-year period ending Dec. 31, 2015, 66.11% of large-cap managers, 56.81% of mid-cap managers, and 72.2% of small-cap managers underperformed their respective benchmarks. Over the five-year period ending on 12/31/15, the results are even worse for active mutual ... Read More

Regency Bias

Recency bias is a term that behavioral finance people use to describe our tendency to put too much emphasis on recent events instead of having a longer view. A case in point. There is the stock of a large U.S. company that has lost 15% of its value in the ... Read More

Stock Market in Presidential Election Years

I love to watch the theater that is our Presidential Election process. After the latest round of primaries, I started to wonder what effect this goofy process might have on the stock market. After all, this year has been off to a rocky start. Might this foretell a down year? ... Read More

Stories Affect Investment Markets

Even though we talk about investment markets as being efficient, they are not perfectly efficient because people are involved and people like stories. Since the dawn of our species, mankind has made up stories to explain what we could not understand. Greek myths explain how evil came to exist in ... Read More

Fiduciary Standard Debate

There is currently a hot debate going on that the Department of Labor (DOL) has fostered regarding whether or not the fiduciary standard should be required for advisers who provide advice to retirement plan participants. The President is behind the standard as is Hilary Clinton and many other politicians. Aligned ... Read More

Deadly Investment Sins

While working on an article about investing, I started by making a list of the most common investment mistakes that investors make. The list is long (waaaaay too long) so I divided individual mistakes into categories. I’ve dubbed these the “7 Deadly Investment Sins.” Here they are: Greed Fear Ignorance ... Read More

Simple Formula for Investing Success

The simplest formula for investment success is to follow the three “P’s”: Perspective: markets go up and down and this too will pass (good or bad). Persistence: long journeys require putting one foot in front of the other and sticking with it. Patience: raising kids, planting gardens, learning a new ... Read More

The Future

The title of this post was the title of an intriguing article that ran in a “New York Times Magazine” article over the weekend. The article opened with this line: “Lots of people pretend they’ve got tomorrow figured out: tech gurus, politicians, C.E.O.s and (yes) journalists. But if we’re really ... Read More

No Longer Enough to Ask

Recently, a prospective client told me about a conversation he had with a representative from one of the largest discount brokerage firms (Fidelity, Schwab, TD Ameritrade, etc.). The client told me: “I inquired how he was compensated and he readily shared that he was paid by ABC based on three ... Read More

Are You a Long-Term Investor

Most people would say “Yes” to this question, but are you really a long-term investor or just when it’s convenient? Here’s what I mean. Right now, commodities and natural resources are asset classes that have lost a quite a bit in the last year (-42% for commodities and -34% for ... Read More