Vanguard on Allocation
Index Universe posted some comments from Vanguard on their thoughts about portfolio construction looking out over the current decade. The headline was Stick to Allocation Strategies and from the standpoint of not giving up on equities, I agree complete...
The Rules, Part XXVIII
Rebalancing of any sort in investing presumes an underlying stability to the economic system, and thus, market returns. Rebalancing will not protect against socialism, war, or an overleveraged position. The concept of rebalancing requires the idea of reversion to mean. It will not protect you when profound shifts are happening, where the market are moving...
Decent returns beat no returns at all
Equities as measured by the S&P 500 ended virtually unchanged for the calendar year 2011. Were it not for dividends the year would have been [...]
On the golden age of individual investing
Earlier this week I did an interview with Katie Stalter of Money Show on the topic of asset allocation and investor education. In the interview [...]
Permanent Asset Allocation
Short run Intermediate Long Run Nominal Real Nominal Real Nominal Real Stocks + - + small - big + 0 Bonds - 0 0 0 + 0 Cash + - + - + - Gold 0 - + small - + - Short run Intermediate Long Run Inflation Real Inflation Real Inflation Real Stocks +...
Stock Prices versus Implied Inflation
Eddy Elfenbein wrote a good post recently on the stock market versus inflation expectations. When I read it, I said to myself, “Wait, is the relationship between nominal and real rates really 1:1, or is it more complex?” Though it is not certain, the regressions that I ran indicated that 1:1 was not falsified by...
Bubble spotting and underperformance anxiety
Jason Zweig in the WSJ this past weekend asks whether it is possible to spot a bubble? Maybe the better question is if you do [...]
Nothing in excess, including momentum
“Nothing in excess.” – Inscription from the temple of Apollo at Delphi (Wikipedia) The financial crisis and ensuring bear market threw the traditional idea of [...]
The behavior gap illustrated
Carl Richards writing at the Bucks Blog and at his own site Behavior Gap has helped popularize the idea that investors are oftentimes their own [...]
The behavior gap illustrated
Carl Richards writing at the Bucks Blog and at his own site Behavior Gap has helped popularize the idea that investors are oftentimes their own [...]
Scotty, we need more dividends!
We have been writing a great deal recently about long term return expectations for the capital markets. The upshot of which is that given where [...]
In praise of doing very little
John Bogle has in the news of late, including here on Abnormal Returns. Many investors believe that the tenets emphasize by Bogle over time including [...]
