As of mid-March, common stocks, as measured by the S&P 500, had reached a five-year high. Pundits love to seize upon this type of “factoid.” It has provided fodder for facile prognosticators, both Bull (Good times are back!) and Bear (The market has gone nowhere in five years!). What is an investor to do when …
No good product goes unabused by Wall Street. Such is the case with exchange-traded funds (ETFs). Our readers will recognize that we recommend several ETFs. These allow investors to take a stake in several of our recommended asset class indexes at an extremely low cost. However, ETFs have grown exponentially in a very short period …
Gold has been rediscovered by the financial press. Ignored and even scorned during the “tech boom” of the late 1990s, it is suddenly a glamour asset. In our view, gold is one of many asset classes worthy of inclusion in most portfolios. While many view gold as a commodity, our parent, the American Institute for …
As the chart to the left demonstrates, returns from the equity markets have fallen sharply in recent weeks. These are the times that try investors’ souls, and put to the test anyone’s ability to stay the course and stick with an established allocation plan. We understand this angst, but we hasten to remind our readers …
This month we are making several changes among our recommended investment vehicles as well as to the “weights” we assign to the asset classes we recommend for investors of various circumstances. These changes do not represent a significant departure from our approach. They result from the emergence of new investment vehicles not previously available to …
Over six years ago we deviated from our disciplined approach to investing when we removed Philip Morris (now Altria, ticker: MO) from our high-yield Dow investment model. We have come to regret that decision, and it is one we intend never to repeat. MO subsequently provided a total return of about 30 percent per year. …
The Federal Reserve’s Open Market Committee (FOMC) chose to keep the Federal Funds target rate at 5.25 percent in its September meeting, while leaving open the possibility of future rate increases. While we will not second-guess the market’s response to this latest Fed news cycle, we do have serious concerns regarding the larger issue of …
Capital markets have undergone a dramatic transformation since 1952. That year eventual Nobel laureate Harry Markowitz tossed aside the widely held notion that securities should be evaluated by their individual characteristics. He asserted instead that the rational investor would focus on how a security impacted the overall risk and return of his portfolio. Fifty-four years …
The shift in power in Washington has, not surprisingly, prompted a good deal of prognostication from those who make their living prognosticating. Thankfully, we are free instead to focus on prudent investing. It is interesting to note that up until the votes were counted, no one was really sure how Congress might be altered. Nevertheless, …
Thailand’s new government, installed via military coup in September, blundered badly when, on December 19th, it imposed new restrictions on foreign investors. The result was bad for Thailand and bad for emerging market investors who were diversified inadequately. We suspect, however, that the lessons conveyed will ultimately prove to be a boon to capital markets, …
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