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Beware Alternative Investments

Date24 Nov 2014

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The sophisticated asset-pricing models we have today allow us to determine the underlying sources of returns to investments. Specifically, they permit us to identify the factors to which an investment has exposure. However, a problem arises when employing current asset-pricing models to consider alternative, illiquid investments. The volatility of such assets is often understated. This...

Saving Ourselves From Not Saving

Date24 Nov 2014

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Americans aren’t saving enough. The numbers appear to back up this claim, which we hear repeatedly. But what I find more interesting is how we react to such statements. I touched on the issue of savings last week, and the responses I’ve heard seem to confirm that it’s a touchy subject. For the sake of...

From the Sharpie of Carl Richards

Date24 Nov 2014

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At the start of 2014, predictions of a market correction were rampant. So what has happened? The market has gone up on some days and down on others, and the volatility that was absent in 2013 has returned. This has led to even more talk about market corrections and projections about what lies ahead. But...

The Risk of Reacting

Date24 Nov 2014

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By C.J. Baxter Many investors are feeling a little jittery these days, and rightfully so. We have had to deal with fears of Ebola, constant tension in the Middle East and a sluggish overseas economy. And that short list fails to mention we recently went through one of the biggest market pullbacks since The Great...

The Surprising Lessons Of QE

Date24 Nov 2014

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On Oct. 29, the Federal Reserve announced the official end to its bond-buying program, otherwise known as quantitative easing (QE). Given all the debate about the efficacy of the Fed’s policy decisions, and the stomach acid created by the many dire forecasts about what was going to happen when quantitative easing ended, I thought it...

Investing Advice: The Good, Bad and Terrible

Date24 Nov 2014

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There is a huge variation in the quality of advice that investors are exposed to every day. If you can’t differentiate between good and bad information, it can cost you dearly. It may even mean the difference between retiring with dignity and running out of money in your golden years. Terrible advice It’s sad that...

What to Do if the Bear Has Emerged From Its Hibernation

Date24 Nov 2014

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It seems like investors have had plenty to worry about recently, even without considering the last few weeks of stock market volatility. After all, we’ve seen: Slowing growth in most of the developed world, including the possibility that European economies will enter their third recession since 2007. Growth in China’s economy decelerating faster than expected....

The Real Lesson From October’s Market Volatility

Date24 Nov 2014

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October was a wild ride for investors. At its low, the Dow Jones Industrial average plunged 5.2 percent from its September high. The Standard & Poor’s 500 index lost 6.2 percent and the Nasdaq was down 7.4 percent. Global headlines seized upon market uncertainty and featured tabloid-style “advice,” posing questions such as, “Is this the...

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