Below the basic appreciation-stability allocation, rebalancing to targets among low-correlation asset classes is how you can get a rebalancing bonus.
Below these asset classes, sectors act as reminders of other aspects of your investment strategy.
While many investors say they want a low-correlation portfolio, they don’t want to actually experience a low-correlation portfolio.
October showed a sharp reversal of the movements of Resource Stocks.
This year, almost every U.S. asset class is in the red except for growth stocks. When the market is throwing punches, you need a tactical defense.
They are based on different indexes and have different expense ratios.
The connection between the price of oil and the price of oil companies is loose.
A high turnover rate is not something you want in a stock fund.
Your investment strategy is critically important but the implementation requires wise fund selection.
Should we have a “Free Countries Asset Class” or a “Foreign Stock Asset Class?”
There is no such thing as “over diversification.”
The process of defining your sectors is an attempt to identify the quintessential features of your strategy and formalize your selection criteria.
The greater the number of holdings the lower the turnover rate with one surprising exception.
Resource stocks represent one of the most interesting collections of diverse indexes as they do not always move in sync with one another.
The higher the correlation the greater the justification to put them in the same asset class.
It is good to take the two categories which are most similar and use them as underlying sector divisions within the same larger asset class.
Should they be over weighted in your portfolio?
Correlations over the past year have been very low, while correlations over the past 10 years have been higher.
“Lawsuit lenders do not advertise prices; they advertise convenience.”
“What do you think of the idea of Socially Responsible Investing (SRI) implemented simply by investing in something like the Domini Social Equity Fund (DSEFX)?”
“We still have plenty of problems, but we’re much better than France, Britain and Germany.”
“The most important thing I learned from my research was never to attempt to forecast the price of oil.”
At first glance, AUNZ did not have great returns in 2014. But is that the whole story?
An immediate fixed annuity is not an investment; it is an insurance product.
How is the change in the value of the dollar computed?
David Leinweber calls this technique, “torturing the data until it screams.”
There was an interesting article by Joseph Lisanti in Financial Planning Magazine entitled, “Should You Be Building Bond Ladders?” which read in part: As with many strategies, laddering works best for clients with sufficient assets to benefit fully from it. … Read More
Exchange funds, also know as swap funds, can provide investors with one highly appreciated security a way to trade it for an equivalently valued but more diversified portfolio.
Morningstar data for the 3-year annualized returns based on style boxes shows us three interesting lessons.
Many investors don’t appreciate asset allocation or understand intuitively how a diversified portfolio can exceed the sum of its parts.
The short answer is, “No.”
Russia is less than 6% of most emerging market indexes.
Unlike stocks, each bond contract has unique characteristics that define how repayment will occur.
Economic freedom enriches society, lifts the poor out of poverty and respects the agency and dignity of human choice.
The portfolio of the five freedom countries has an annualized return of 11.06% over the past decade.
Most financial planning articles about annuities pull their punches.
When the dust settles, can I really buy things for pennies on the dollar?
“Up until recently” annuities were a bad idea. They still are.
The documents where you can review 20 key issues looking for 10 red flags, or…
I expect we have seen the bottom of both the housing market and 30-year fixed interest rates.
“A well-designed financial plan can get derailed by the wrong investment. Here are seven things investors can probably do without.”
Monthly commentary on the countries ranked high in economic freedom.
Some of the monthly commentary on the returns of Northern Europe compared with the EAFE Index.
“To answer that, it’s good to review key indicators, like the Shiller P/E ratio, and their recent history, experts say”
“The divergent claims about gold can be puzzling. How can a commodity that predominantly is either stored in a vault or gets formed into jewelry have so many stories spun around it?”
Fearful of monetary or societal failure, many hope that owning gold will bring them peace of mind.
On average gold keeps up with inflation, albeit with wild gyrations.
From $255.95 gold rose to $1,795.00 between 4/2/2001 and 11/8/2011.
From $850 gold dropped to $255.95 between 1/21/1980 and 4/2/2001.
Gold advocates cherry pick gold’s returns from trough to peak.
Stocks have an average annualized appreciation over inflation of 6.86%, whereas gold is just 0.33% over inflation.
The optimum asset allocation to physical gold and silver is 0%. Instead, we recommend you use resource stocks as an inflation hedge.