Category Equities
Five Things Investors Should NOT Do Now (WSJ/Zweig)
Jason Zweig hits it right on the head. Must-read for all investors. Summary:1. Don’t fixate on the news2. Don’t panic3. Don’t be complacent4. Don’t get hung up on the talk of a “correction”5. Don’t think you — or anyone else — knows what will happen next Read #5 again. And again. It drives all the […]
Malkiel: Buy Stocks, not Bonds
Burton Malkiel has been speaking up a lot lately, and with much the same message – repeated several times over the last few months (at least since an op-ed back in April). While hitting on some of the same themes he’s hit on for 40 years (index funds, low costs, broad diversification, don’t time the […]
Ten most common mistakes
Totally worth reading. I’d have said exactly these same things and I tell them to clients all the time. So good I’m thinking of mailing this link in my next On The Spot email. http://www.ritholtz.com/blog/2012/07/investors-10-most-common-mistakes/ A really great “top 10” list by Barry Ritholtz: Investors’ 10 most common mistakes I seriously recommend reading the whole […]
Real 10 year yields
From an article about adjusting assumptions for retirement withdrawal rates in a ‘yield-free’ world. http://www.advisorone.com/2012/06/27/retirement-in-a-yield-free-world?t=the-retiree The author makes some important points about the rule-of-thumb that so many use for planning the level of withdrawals that’s “safe” from a given portfolio (or flipping it around, the level of savings that will be necessary to […]
Zvi Bodie, TIPs, Zero-Cost Collars and Equity Risks
Major piece in today’s Wall Street Journal, “Why Stocks are Riskier Than You Think” by Zvi Bodie and Rachelle Taqqu http://online.wsj.com/article/SB10001424052970204795304577221052377253224.html?mod=googlenews_wsj (Of course, Bodie and Taqqu are also hoping that this article will lead a lot of people to buy their recent book, “Risk Less and Prosper”. Bodie and Taqqu’s own retirement plan likely hinges […]
Waggoner: What we learned from bonds’ victory
http://www.usatoday.com/money/perfi/columnist/waggon/story/2012-01-05/stocks-bonds-diversification/52395986/1 Great column from John Waggoner in USA Today. The headline is a reference to the fact that over the last 1yr, 10yr, 20yr and 30ys periods, bonds (long term treasuries, mainly) have had higher total returns (with dividends all reinvested) than large-cap US stocks (mainly the S&P 500). Some takeaways: the selection of stocks […]
WSJ/Burton Malkiel: Where to Put Your Money in 2012
WSJ/Burton Malkiek: Where to Put Your Money in 2012
Another excellent op-ed piece by Burton Malkiel, author of the classic “A Random Walk Down Wall Street”.
Malkiel makes the following points (summarized – but you should really read the article):
- Bonds, especially US and Europe, are not positioned to do very well in the future
- Stocks, especially the US and Emerging Markets are
- Emerging Markets, in general but especially Brazil and China and even India look good (natural resources, demographics, etc)
- Single-family houses in the US are less expensive and with ultra-low mortgage rates (see “Bonds” above — a mortgage is the opposite side of buying a bond – it’s borrowing rather than lending!) look good. (“Housing affordability has never been better.” Though, of course, that’s contingent on good credit and probably a job.)
- Costs matter – this was the final paragraph and it’s always worth repeating: “Control the thing you can control — minimize investment costs. That is especially important in a low-return environment. Make low-cost index mutual funds or ETFs the core of your portfolio and ensure that any actively-managed investment funds you purchase are low-expense as well.”
Hardly a “lost decade”
We recently heard from a person who has some complaints about the last decade’s performance of his 401(k). He said he’d been putting money in since the beginning of 2000, regularly, and after all this time, the portfolio in his 401(k) is worth a little bit less than the sum of all the money he’d […]
Hulbert: Are Stocks Undervalued?
http://www.marketwatch.com/story/are-stocks-undervalued-2011-09-06 Hulbert does a quick analysis comparing today’s stock market’s P/E – both trailing and projected forward – against historical norms. And he finds that based on that analysis, stocks may appear either undervalued or perhaps pretty fairly valued – but they certainly don’t look particularly expensive. While it’s hard to argue for any kind […]
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