Expect Years of Pain before Market Gain

The more risk you take, the more money you’ll earn — if you live long enough. History shows that it can take decades for stocks to outperform. Making money in stocks can take a long time. A $10,000 investment in the S&P 500 during April 2000 grew to only $10,306 by October 2011. A similar [...]

Withdrawal Rates Drop as Fees Rise

How much you can safely withdraw in retirement is a function of asset allocation, market return and fees. Unfortunately, mutual fund expenses and advisor fees are often left out of the equation. These omissions can significantly change the safe withdrawal amount. Philip L. Cooley, Carl M. Hubbard and Daniel T. Walz authored an early and [...]

Guru Grades, Redux

Those darn gurus can’t seem to get it right. When a majority of market timers say the stock market is in a decline, the market rallies, and when they say it’s time to buy, hold onto your wallet. I have been studying and recording the poor timing ability of professional investors for more than 20 [...]

Why We Don’t Buy Corporate Bond ETFs

Corporate bond ETFs don’t work for our clients. Large price discounts and premiums to net asset value (NAV) tend to occur when we are trading. These deviations from NAV can add unnecessary trading cost to portfolios. Accordingly, we’re believers in traditional corporate bond mutual funds that trade at NAV at the end of the day. [...]

Defining the Value in Value Stocks

Value is in the eyes of the beholder. Every value stock investor has a different opinion of what value is, and there is no right answer. Everything works sometimes, and nothing works all the time. There is also no consensus among index providers of what a value stock is or how portfolios of value stocks [...]