The Portfolio Solutions 30-Year Market Forecast for 2012

Each year, Portfolio Solutions® puts forth a long-term forecast for stock and bond market returns. We know it’s not possible to predict short-term return, but it is possible and necessary to estimate long-term expected returns. These estimates form the basis for investment decisions. Our asset class forecast relies on the simple belief that market participants, [...]

Thank Goodness for Index Funds

A return of investment precedes a return on investment, and I am thankful to my index fund portfolio for providing both. A simple buy-and-hold index fund strategy has achieved a very respectable return over the past 12 years despite a tough stock market. But perhaps more important, this strategy provided a safe return of my [...]

Fears of Soaring Rates are Overblown (Part 2 of 2)

In the first part of Fears of Soaring Rates are Overblown, I reviewed Federal Reserve actions for dealing with the credit crisis since 2008. These include four major actions that have increased the monetary base by roughly $1.9 trillion, of which $1.6 trillion are in marketable securities. The Fed first provided liquidity to banks and [...]

Fears of Soaring Rates are Overblown (Part 1 of 2)

The Federal Reserve Bank has increased its balance sheet by an astonishing $1.6 trillion since the financial crisis began in 2008. This action added much needed liquidity to financial markets and lowered interest rates for everyone. Some people fear an unwinding of these assets will lead to soaring interest rates. I don’t agree. Part 1 [...]

Luck Runs Out for Former Star Funds

Former top mutual funds are falling behind their peer groups in record numbers. Overall, only 42 percent of past winning US equity funds for the five years ending in September 2006 stayed in the top half over the next five-year period ending in September 2011. Another 44 percent fell to the bottom half of the [...]