Quick Take on Fixed Income September, 2015 Q: How do equity and fixed income markets differ? A: Most people are familiar with the equity markets and how they work. After all, anyone can turn on the television and see traders scurrying around the floor of the New York Stock Exchange, filling orders for their clients….
“Today’s investors find it inconceivable that life might be better without so much information. Investors find it hard to believe that ignoring the vast majority of investment noise might actually improve investment performance. The idea sounds too risky because it is so contrary to their accepted and reinforced actions.” So writes Richard Bernstein in his…
In my previous post, we reviewed the historical evidence on bear markets and financial crises, as well as the sources of the latest crisis. Today, we pick up by discussing reasons why all the bad news you’ve been hearing doesn’t mean you should reduce your equity allocation. Reasons Not To Panic First, all this news…
It has long been my view that much of the financial media serves as a shill for the securities industry. It stokes fear and anxiety in an effort to encourage investors to “do something” with their holdings. Activity means trading, and trading means higher profits for bloated brokerage firms. It’s really not more complicated than…
Despite Wednesday’s recovery from steep losses earlier in the week, the major U.S. stock averages are on track for their biggest monthly percentage losses in five years or more. That means your retirement portfolio, your 401(k)s and IRAs, may have lost value as well. But there may be a silver lining to this market slide….
Two of the most-well-known factors that help explain stock returns are the value effect (where equities with lower prices relative to metrics—such as book value, earnings, cash flow, sales and dividends—tend to outperform the equities with higher prices relative to those metrics), and the momentum effect (where assets that have outperformed in the recent past…
Target date funds are a popular default option in many retirement plan investment schemes, but are they a good fit for younger, millennial investors? CNBC Senior Personal Finance correspondent Sharon Epperson discusses target date funds with certified financial planners Tim Maurer, of The… Read the rest of the article on CNBC.
I love spending time in the mountains. So a few weeks ago, I jumped at the opportunity to join a friend, my son and seven of his friends on a trip into the Uinta Mountains. This range sits about an hour east of our home in Park City, Utah. We planned the trip to last…
The financial worries that keep Americans up at night run the gamut from cradle to grave: daily expenses, college education, retirement nest eggs. While stressing over the big fiscal picture, many investors easily fall into some costly—but very much avoidable—financial traps. We asked the CNBC Digital Financial Advisor Council to weigh in with some of…
Q: Does currency risk add value in the fixed income markets? A: As interest rates on high quality bonds have remained relatively low, some investors continue to search for ways to achieve higher returns in the fixed income markets. One strategy that has been in the news frequently is the idea of purchasing non-U.S. dollar…
As I write this on Aug. 10, despite all the economic problems facing investors (such as Greece, the slowing Chinese economy, a bear market in Chinese stocks, the collapse in commodity prices and Puerto Rico’s default), the VIX index, a measure of the market’s expectation of 30-day volatility, had closed above 14 only once since…
It’s not as if investors didn’t already have enough to worry about with the Greek crisis, Puerto Rico’s default, the Iranian nuclear agreement, ISIS, the Fed ending its zero-interest-rate policy in the near future, and gurus such as GMO’s Jeremy Grantham proclaiming that the market is vastly overvalued based on the Shiller CAPE 10 ratio….
Given changes in the jobs market and retirement savings options, how can risk-averse millennial investors in their 20s and 30s secure their futures? CNBC Senior Personal Finance correspondent Sharon Epperson discusses the future for Gen Y workers with certified financial planners Tim Maurer, of The… Read the rest of the article on CNBC.
In my role as director of research for The BAM Alliance, a community of more than 140 registered investment advisor firms, I’m frequently asked both by clients and other advisors to address the issues raised by market “gurus” who make forecasts in the financial media. These forecasts often create anxiety, so investors naturally ask whether…
Slightly more than a decade ago, several studies were published raising the possibility that an allocation to commodities (in the shape of fully collateralized futures) could improve the efficiency of a portfolio due to the diversification benefit (the low to negative correlation of commodities to both stocks and nominal bonds) provided through including this asset…