Our Core Beliefs About Investing Diversify Globally. We believe diversification among and within asset classes in order to manage risk is prudent. Successful investing means not only capturing risks that generate expected return but reducing risks that do not. Avoidable risks include holding too few securities, betting on countries or industries, following market predictions, and … Continue reading Investment Management
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The Uncommon Average
The US stock market has delivered an average annual return of around 10% since 1926. But how often have the stock market’s annual returns actually aligned with its long-term average? Read More
When Rates Go Up, Do Stocks Go Down?
Research shows that, like stock prices, changes in interest rates and bond prices are largely unpredictable. Read More
What do you regard as the most difficult period in the financial markets during your 25 years in the investment business?
Dave Butler from DFA offers a sports example to help investors apply discipline in a stressful market. Read More.
Recent Market Volatility
The market events of January 2016 provide an opportunity to examine several questions important to investors and revisit some fundamental principles of investing in capital markets. Read More.
Should Investors Sell After a “Correction”? Financial professionals generally describe any decline of 10% or more from a previous peak as a “correction,” although it is unclear what investors should do with this information. Should they seek to protect themselves from further declines by selling, or should they consider it an opportunity to purchase stocks … Continue reading
MasterChef of Investing. In the popular TV program MasterChef, contestants face a series of cooking challenges. From low quality ingredients to inadequate preparation and poor implementation, so many things can, and do, go wrong. It’s a bit like investing. Read More.
CAPE Fear: Valuation Ratios and Market Timing As broad market indices such as the S&P 500 have set new record highs in recent weeks, many investors have become apprehensive. They fear another major decline is likely to occur and are eager to find strategies that promise to avoid the pain of an extended downturn while preserving … Continue reading
Connecting the Dots Human beings love stories. But this innate tendency can lead us to imagine connections between events where none really exist. For financial journalists, this is a virtual job requirement. For investors, it can be a disaster. Read More.