Learning Center

401(k) Madness

Date25 Aug 2014

Comment0

All across America, a familiar ritual is repeated at least quarterly. Sponsors of 401(k) plans meet with their brokers, insurance companies or other advisers. The purpose of the meeting is to decide which funds to keep as investment options and which ones to eliminate. Everyone has a familiar role. The plan adviser comes prepared with...

Index investing still wins in emerging markets

Date25 Aug 2014

Comment0

A regular reader sent me the following email: “If you get the chance, I would appreciate you including a piece about whether the Franklin Templeton Developing Markets (TEDMX) fund adds value. Its manager, Mark Mobius, is always quoted as the guru and pioneer of emerging markets investing. Does he do any better than a passive...

Investors Too Focused On Dividends

Date25 Aug 2014

Comment0

Despite the fact that financial theory has long held that dividend policy should be irrelevant to stock returns, one of the biggest trends in recent years has been individual investors rushing to buy dividend-paying stocks. In some cases, it’s a substitute for safer, but lower-yielding bonds. In others, it’s because investors believe dividend-paying stocks are...

Go Ahead, Spice Up Your Investing Life

Date25 Aug 2014

Comment0

“I’m bored.” You’ve said it. I’ve said it. Your children or nieces or nephews have said it. Our usual response to these two little words is to recommend doing something about it. You tell children to go outside. You pick up a new book or go to the movies. I head out on my mountain...

Beware The Promise Of Junk Debt

Date25 Aug 2014

Comment0

Until the recent sell-off toward the end of July, yields on high-yield bonds had been hitting record lows. At the end of June 2014, the yield on five-year bonds rated BB—the credit rating just below investment grade—was only 4.3 percent, or about 2.7 percentage points higher than the yield on five-year Treasurys. That puts the...

Resurrecting the Size Premium

Date25 Aug 2014

Comment0

There have been a number of articles over the past few years claiming to refute the existence of a small-cap (or size) premium, which is the historical difference in returns between small-cap stocks and large-cap stocks. While the critiques have been somewhat varied, two common claims are that the risk-adjusted returns of small-cap stocks have...

Bank Loan Funds No Free Lunch

Date25 Aug 2014

Comment0

When interest rates are low, some investors stretch for yield by taking on credit risk. At the same time, many investors are also seeking alternative ways to protect themselves against a potential rise in interest rates, without sacrificing that hard-earned yield. These dual concerns have led many to consider bank loan funds, which recently have...

Don’t-miss reads for investors

Date25 Aug 2014

Comment0

It’s not too late to make some summer reading recommendations, and a quick review of my bookcase turned up some titles I think would be valuable for any investor. These books cover topics ranging from a detailed explanation of how the markets really work to the basic benefits of financial planning and some of the...

Learning Center

Categories