Wealth Advisor Ken Rosenbaum looks at some essential financial tasks and other important to-do’s you may have overlooked as the first day of a new academic year approaches and you get ready to send your child off to college. The day has come. Your little baby has grown up and is now ready to leave …Read More.
Why do investors choose to keep playing the loser’s game? Larry Swedroe offers some explanations of his own, then unpacks a study that suggests a form of the conjunction fallacy has a role in active management’s survival. The opening chapter of my first book, “The Only Guide to a Winning Investment Strategy You’ll Ever Need,” …Read More.
What type of investor are you? Larry Swedroe unpacks a CFA Institute Research Foundation brief on risk profiling and tolerance that looks at four investor personalities, and the potentially problematic behavioral tendencies likely to come with each. In my book, “The Only Guide You’ll Ever Need for the Right Financial Plan,” there’s a detailed discussion …Read More.
A lot of investors are curious to know what an inverted yield curve, if one occurs, might mean for the stock market. In an analysis of Fed data, Jared Kizer concludes such inversions don’t preordain poor equity returns and that other context matters. Investors and advisors alike are curious about the implications of a potentially inverted …Read More.
Do investors see dividend increases as good or bad news? It depends on whether they’re looking at an individual stock or an entire market. Larry Swedroe reviews a new study into how a country’s aggregate dividend payout rate affects its equity returns. It’s been well-documented that stock prices tend to react positively when companies announce an …Read More.
Some active mutual funds have prospectus benchmarks that understate risk and, thus, overstate relative performance. Larry Swedroe unpacks a study that explores how such funds benefit from that overstatement at investors’ expense. Evaluating the performance of actively managed mutual funds generally involves comparing a product’s results with some passive benchmark (the SEC requires that funds …Read More.
You wake up tomorrow and everything about your life is exactly the same except you have no possessions other than the clothes on your back and a bag of money equal to your financial worth today. Tim Maurer asks: What would you change? Is that you? Are you fortunate enough to be in the tiny …Read More.
A recent study found just eight active mutual funds out of 1,000 showed statistically significant alpha. Larry Swedroe examines the research, and offers some additional analysis demonstrating how elusive a prize true alpha really is. Qiang Bu, author of the study “Do Persistent Fund Alphas Indicate Manager Skill?”, which appears in the Fall 2017 issue …Read More.
Larry Swedroe takes a look at how adding unique sources of risk and return can improve the efficiency of traditional stock and bond portfolios. Most people avoid budgeting because they consider it an exercise in repressive tedium. But it doesn’t have to be. By applying the science of motivation, economic evidence and the art of …Read More.
Paper results or real-world advantage? Jared Kizer explores whether efficiently managed strategies can, net of fund expenses and trading costs, capture the historically larger value premium found in small-cap stocks. On paper, there is abundant evidence that various return premia have been larger in small-cap stocks compared to large-cap stocks. Table 1, for example, shows …Read More.