Asset Allocation Guide: U.S. vs. International Equity
In our ongoing series looking at asset allocation issues, we’ve already covered some essentials, namely, how to analyze your ability, willingness and need to take risk — and what do when one or more of those factors conflict. Figuring out where you fit along the risk...
Expected Stock Returns Around the Globe
In order to rationally develop an investment plan you need to estimate long-term returns for the asset classes in which to invest – without doing so you cannot determine how much to allocate to risky stocks and how much to...
Are Demographics Really Destiny?
I recently came across an article on Seeking Alpha by The Statistical Investor entitled “Demographics Are Destiny: World Population Trends“. The article begins: “As they say, demographics is destiny. Just ask Japan. The longer your investment horizon, the more exposed...
Volatility & Corrosive Contango
The presence of regularly occurring anomalies in conventional economic theory led to the development of the field of behavioral finance, and the volatility anomaly is one that deserves some special attention. Anomalies directly violate modern financial and economic...
Dividends and Behavioral Econ
It’s long been known that many investors have a preference for cash dividends. But from the perspective of classical financial theory, this behavior is an anomaly. Here’s why. It’s perplexing behavior because before taking into consideration what are referred to...
Do Corporate Bonds Add Value in Portfolios
I frequently get asked about the merits of corporate bonds, both investment-grade (IG) and high-yield (HY), relative to government and municipal bonds. I don’t believe the risk-return profile for long-term investors (particularly taxable individual investors) is improved by owning IG...
How to Confront Debt Before You Retire
It used to be that once Americans neared retirement, they had whittled down (or eliminated) their debt. Freed from monthly principal and interest payments, these fortunate individuals were prepared to retirewith dignity. Times have changed. Read the rest of the article...
A Thriving Export to Canada: Broker Misconduct
Most Americans have a high regard for our Canadian neighbors to the north. We respect their honesty, their integrity and, especially, their civility. The statistics on crime in the U.S. and Canada show that Canadians live in a more lawful, peaceful society....
Making the Most of a Bad 401(k)
We need not look far to learn that 401(k) plans are imperfect or worse, so instead of lumping on more criticism about how you and your employer have botched your 401(k), let’s discuss how to make the most of a not-so-great...
The Best Investment Strategy? Getting Out of Our Own Way
We’re still making the same old mistake of buying investments when prices are high and selling them once their prices have fallen. I had hoped things had changed, I really did. But Morningstar’s latest Investor Returns data says otherwise. More than 10...
