Category Archives: Investing

Your Money

“Reversion to the mean” is a useful concept in investing. When we apply this concept to stock index valuation, this implies that there is a tendency for stock prices to trend higher when the market PE is well below the … Continue reading

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Your Money

One of the primary ways for an individual investor to gain a competitive advantage relative to the markets is to have a long term time horizon. When viewed through this lens, investors with a disciplined long term approach can benefit … Continue reading

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Your Money

Traditionally, the investment advisory industry has recommended two main types of investments for client portfolios, equity (stocks) and fixed income (bonds). In most environments, high quality fixed income investments carry lower risk (as measured by price volatility) than high quality … Continue reading

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Your Money

The negative news about the economy continues and yet the stock market has kept going up.  This divergence reinforces one of the key lessons of active management, which is that the broader the financial instrument, the less predictable the movement … Continue reading

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Your Money

The financial repression exemplified by the Federal Reserve’s zero interest rate policy (ZIRP), that was begun on Dec 16, 2008, has many side effects. One of these side effects is to drive down the interest income that savers and investors … Continue reading

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Markets drop amid massive public spending

The major U.S. equity averages have reached correction territory today, which is defined as a 10% drop from their recent high.  The Dow Jones Industrial Average, Standard & Poor’s 500 and the Nasdaq all hit their highs of 2011 high … Continue reading

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2011: Another Bull Market Year for Stocks?

We’ve analyzed recessions and market downturns going back to 1953. In that time, there have been 10 recessions, one every 5 to 6 years.  You can see in Callan’s Periodic Table of Investment Returns that the sharpest rebounds in the stock … Continue reading

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