Posts by MFA

2018 Q3: Why invest in foreign equities?

Posted by on Oct 30, 2018 in MFA Quarterly Commentaries

With the US stock market up over 10% through the third quarter this year, you may have asked yourself why your portfolio wasn’t up more. The answer lies in global diversification. You hold many types of investments in your portfolio and most of the other asset classes in the portfolio are flat or down for the year. That’s a normal part of diversification. It’s rare to have all parts of the portfolio up or down at the same time. It’s normal to have some areas performing well while others aren’t. Let’s look at the performance of global stock markets year-to-date through 9/30/2018 as...

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2018 Q2: Sustainable Investing

Posted by on Jul 24, 2018 in MFA Quarterly Commentaries

Over the years we have quietly evolved our investment philosophy and holdings so as to be able to focus our investment towards those companies doing the most good (and least harm) for the planet and for society. In doing so, we have become leaders in this approach to incorporating environmental and socially responsible criteria into building client portfolios. In fact, MFA is one of the top investors in the sustainable funds of Dimensional Fund Advisors’ (“DFA”).

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June 2018: Guessing Jelly Beans

Posted by on Jun 5, 2018 in MFA Insights

Have you ever seen that game where the goal is to guess the number of jelly beans in a jar? When you look at the range of guesses, you’ll find a huge disparity – some people’s guesses are surprisingly low while others’ are much too high. Yet, something amazing happens when you take the average of everyone’s guesses: The average guess ends up being right on. This effect is referred to as “The Wisdom of the Crowds.” The term, coined in the book by James Surowiecki, proposes that the collective intelligence of a crowd can exceed that of any of its individuals. The wisdom of the crowds is very relevant to investing.

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2018 Q1: Round trip to tax time

Posted by on Apr 15, 2018 in MFA Quarterly Commentaries

The First Quarter’s Round Trip The global stock markets started the year off with a bang and by the end of the first quarter of 2018 they were back to a touch below where they started the year. After roaring up 6% to 8% in January, various global markets ended the quarter modestly down: U.S. stocks were down -0.61%, international stocks were down -1.18%. In the meantime, various bond market indices were also down slightly (flat to down about -1.5%). Over the past 12 months, overall diversified returns were about where we would expect with a large variance in returns. Bonds were flat or down...

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Feb 2018: Welcome Back Volatility

Posted by on Feb 16, 2018 in MFA Insights

After an unusually long run of particularly calm and rewarding markets, volatility is back. Looking back, 2017 offered an especially mellow ride for investors. The largest daily drop in the S&P 500 in 2017 was -1.82%. The largest daily gain was 1.37%. And the index ended the year up 18.7%. 2018 began in the same vein as January produced 10 record highs in 13 days. All this calm and all of these positive returns may have lulled investors into feeling that this was normal (“Hey, we could get used to this!”) Then, with more drama than an Olympic downhill run, volatility returned in the...

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