Retirement Planning

Are You Still Investing Without a Margin of Safety?

In retrospect, Brexit turned out to be more meaningful than Grexit. And while the immediate reaction of global financial markets (NYSEARCA:VT) to the England’s decisive vote to leave the European Union (EU) was negative, it’s a stark reminder of why investing without a margin of safety is negligent. With the exception of precious metals (NYSEARCA:GLTR), mining …

Are You Still Investing Without a Margin of Safety? Read More »

Sexy vs. Boring: Who’s Winning?

Higher investment risk leads to higher investment returns, right? It’s a Wall Street axiom that we’ve heard so many times it’s become ingrained in us. But conventional wisdom and reality have the peculiar habit of departing from one another. And what’s happening in 2016 is a noteworthy example of this grand departure. With the year already …

Sexy vs. Boring: Who’s Winning? Read More »

How Should Your Non-Core Portfolio Look?

I’ve written extensively about the role of an investor’s non-core portfolio. It’s one of the three cornerstones of a well-built portfolio (see figure below) and it always plays a complementary role to the much larger core portfolio and a person’s margin of safety container. If used properly, the non-core portfolio can greatly enhance an investor’s total …

How Should Your Non-Core Portfolio Look? Read More »

Financial Markets 2.0 Image

Should Correlations Drive Your Investment Decisions?

Do stock market correlations matter? Statisticians use correlations (or cross-correlation) to measure the relationship between asset classes or investments. The general idea is to better understand the similarity or dissimilarity in how investments perform against each other and to build a portfolio of investments that can benefit. The CBOE S&P 500 Implied Correlation Index (ChicagoOptions:^KCJ) …

Should Correlations Drive Your Investment Decisions? Read More »

Lagging Small Cap Warning Sign For Stock Market?

The Performance of Active Managers Keeps Getting Worse

Years ago John Bogle once quipped, “If the data do not prove that indexing wins, well, the data are wrong. ” Here’s the latest: There’s no need to second guess Bogle on this particular matter because a) the data proves indexing wins, and b) the data is completely right. The table below shows the 1, 3, …

The Performance of Active Managers Keeps Getting Worse Read More »

Retirement Plan

Is “Saving More Money” Always the Cure?

Wall Street’s remedy for fixing whatever problems that afflict your investment portfolio is simple: “Save more money.” And if you happen to be among the godforsaken group that always manages to have unsatisfactory investment results, regardless of whether the pesky stock market is up or down, Wall Street’s solution is invariably the same: You need to “save …

Is “Saving More Money” Always the Cure? Read More »

A $1.58 Million Portfolio with No Captain

Has your financial advisor contacted you lately? Although global stock markets (NYSEARCA:VT) have recovered from their earlier in the year losses, it could’ve revealed flaws with your investment portfolio’s design. Often, flaws that are camouflaged by rising markets are exposed and exploited in rocky markets. (Audio) Why Robo “Advisors” are Hazardous to Your Wealth Ultimately, advisors should take responsibility for …

A $1.58 Million Portfolio with No Captain Read More »

3 Reasons Why Robo Advisors are Hazardous to Your Wealth

“Robo advisors will manage over $5 trillion in 10-years.” Have you seen headlines like this? According to the reports, robo advisors are so wonderful, they’re going to overtake the world and make it a better place to invest. Imagine, if you can, flowers and cute Bambis everywhere! In reality, robo advisors are not really “advisors” but rather online …

3 Reasons Why Robo Advisors are Hazardous to Your Wealth Read More »

4 Moments When “Stay the Course” is the Wrong Investment Advice

The worst January start for U.S. stocks since 2009 should get your attention. If you’ve been hiding underneath a rock or hibernating in a cave-like dwelling, it’s time to come out. “A little sunlight is the best disinfectant,” as Judge Brandeis might say. Most global stock yardsticks from China (NYSEARCA:ASHS) to Japan (NYSEARCA:EWJ) and even the United …

4 Moments When “Stay the Course” is the Wrong Investment Advice Read More »

If You’re Not Preventing Stock Market Losses, You Better Start Now

What’s more important? Making gains in the stock market or preventing losses? Before answering that question, let’s list a few common fallacies about risk: • The full spectrum of market risk can be accurately defined in a single magic formula or statistic • Long-term investing always guarantees success, so go ahead and take all the …

If You’re Not Preventing Stock Market Losses, You Better Start Now Read More »

Don’t Count on the Fed to Backstop Your Investments

Yes kids, stock prices can sometimes plummet. And they did during the first trading session of 2016. It’s a helpful reminder to forgetful innocents about this unforgiving fact. The chart below shows how the SPDR S&P 500 ETF (NYSEARCA:SPY) has declined 1.65% over the past month. That in itself isn’t disastrous, but stock market volatility (ChicagoOptions:^VIX) …

Don’t Count on the Fed to Backstop Your Investments Read More »

(Podcast) Your 2016 Investing Philosophy in Just Three Words

The beginning of a new year is always an important moment for personal reflection. And whatever it is that we want from our lives – whether it’s to become a better spouse, begin a new exercise routine, or just become better people – we must recognize that change is imperative if we’re going to reach our goals. …

(Podcast) Your 2016 Investing Philosophy in Just Three Words Read More »

4 Things to Understand about Your Portfolio’s Margin of Safety

Does your portfolio have a margin of safety? I ask that question because the total U.S. stock market (NYSEARCA:SCHB) has been rocky over the past few weeks and now has a year-to-date (YTD) loss of -1.23%. And since most investor underperform the stock market and the index ETFs tied to it, it’s fair to assume …

4 Things to Understand about Your Portfolio’s Margin of Safety Read More »

DON’T Invest a Single Dime Without this Crucial Document

Imagine hiring a builder to construct you a home. You tell the builder how you want the home to look and you tell them about all your desired features. Instead of showing you a blueprint, the builder starts construction and a short-time later, your house is completed.  But there’s a very big problem: The home’s final design is nothing like what …

DON’T Invest a Single Dime Without this Crucial Document Read More »

The Cost of Investment Advice is Still Too High

There are 118 million U.S. households and 108 million have under $500,000 of investable assets while 100 million have less than $100,000 to invest. What does it mean? It means the vast majority of the investing public still doesn’t meet the dollar minimums required to work with a licensed financial advisor. And for those who …

The Cost of Investment Advice is Still Too High Read More »

The Proper Context of Hedge Fund Money

In case you missed it, Wall Street’s rich and famous are having their worst yearly performance since 2011. Big bets by hedge funds on energy (NYSEARCA:XLE), healthcare (NYSEARCA:XLV), and commodities (NYSEARCA:DBC) have nuclear bombed shareholders’ money. Here’s just a small sample of the multi-billion dollar meltdown: • David Einhorn’s large stake in Consol Energy (NYSE:CNX), the …

The Proper Context of Hedge Fund Money Read More »

Improving Bogle’s 50/50 Portfolio

Jack Bogle has made changes inside his personal investment portfolio. In a news interview last week, the legendary indexer revealed that his 60% allocation to U.S. stocks and 40% to bonds via index funds (Nasdaq:VBINX) has shifted to a more conservative asset split of 50/50 in each group. Bogle is the 86-year old founder of Vanguard Group, the …

Improving Bogle’s 50/50 Portfolio Read More »

Stock Market Pit

Wall Street’s Perennial Optimists Strike Again

It’s been said the only bubbles that Wall Street sees are the bubbles in its champagne glasses. It appears those words are true because year-end targets for the S&P 500 (SNP:^GSPC) by Wall Street’s finest – are shall we dare say – quite bubbly: Bank of America 2,200 Goldman Sachs 2,100 Morgan Stanley 2,275 JPMorgan 2,250 Stifel 2,350 …

Wall Street’s Perennial Optimists Strike Again Read More »

Portfolio Exam: A Hyper-Aggressive $1.29 Million Portfolio with Flaws

It’s commonly and incorrectly presumed that people with large investment portfolios are smart investors. But as counterintuitive as it may sound, this false presumption is simply not true. How do I know? Because I’ve analyzed and graded many multi-million dollar investment portfolios ($27 million is the largest one I’ve graded so far this year) using …

Portfolio Exam: A Hyper-Aggressive $1.29 Million Portfolio with Flaws Read More »

0

Your Cart is Empty