Feb 2017 – Determining market direction related to average returns
Bestselling author Michael Lewis has another hit on the shelves, “The Undoing Project” in which he profiles the fascinating collaboration of two Israeli born psychologists Daniel Kahneman and Amos Tversky whose research, writing and teaching challenges the way we think. It points out the flaws of our mental wiring that were largely soldered into place thousands of years ago and haven’t caught up with modern realities.
Mr. Lewis’s compelling read had us going back to one of our favorites, Daniel Kahneman’s 2011 book, “Thinking, Fast and Slow”. Dr. Kahneman, a psychologist, was awarded a Nobel Prize in Economics in 2002 for the work he did in the field now widely known as Behavioral Economics. We used his thinking to take a look at the surprising gains of the stock market since the recent election.
Read More2016 Q4: Trump and Bond Prices
In a backdrop of all kinds of unusual and unexpected news, not the least of which was the largely unanticipated Trump presidential victory, the US Stock market had one of its few “normal” year in over nine decades. Allow us to explain.
Read MoreNov 2016 – Election Results: Hold the Course
It’s done and decided. Trump wins.
Markets are actually rallying today and reacting relatively calmly.
Will your investment portfolio be OK? Yes.
As always, what happens in the short-term is unpredictable. And that’s OK since we are investors, not speculators.
2016 Q3: Presidential Elections and the Stock Market
Next month, Americans will head to the polls to elect the next president of the United States. While the outcome is unknown, one thing is for certain: There will be a steady stream of opinions from pundits and prognosticators about how the election will impact the stock market. As we explain below, investors would be well-served to avoid the temptation to make significant changes to a long-term investment plan based upon these sorts of predictions. Short-Term Trading and Presidential Election Results Trying to outguess the market is often a losing game. Current market prices offer an...
Read MoreAug 2016 – Why it can be hard to make money in the stock market
Hint: It’s not what you think, it’s what you feel. One of the greatest ironies of investing is that some of the simplest advice is often the most important and the most difficult to stick to. For years, decades even, we have advocated “profits through patience”, accepting the returns the global stock markets provide without the need to outguess the next short term move. Through wars, recessions, elections, natural disasters and other major news events, persistence has paid off. $1,000 invested in the US Stock Market (S&P 5001) in January of 1970 grew to just under $90,000 by...
Read More2016 Q2: Our Approach vs. Index Funds
In response to one of the questions raised in our recent client survey, we will address how our investment approach differs from buying simple index funds and what are the results…
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