The following is an excerpt from the letter we wrote to clients this month. It offers a useful lesson in the behavioral tendencies of humans. Many Americans tuned in to watch the World Cup during the past month. Some even learned player names and now better understand the game’s subtleties. From this experience, it likely became [...]
Much has been said or written over the past decade about the future direction of interest rates. Nearly everyone has an opinion on the subject including professional investment managers, CNBC correspondents, your golfing partner, and the person who cuts your hair. We like to make investment and financial planning decisions based on what is known [...]
My mother owns an iPhone but constantly gets frustrated at her perceived difficulty of answering a call. I am confident that she has never downloaded an app, sent a text message, or used the phone to open an email. She can solve the Sunday New York Times crossword puzzle but if you asked her to [...]
Imagine walking into your new doctor’s office for a routine physical. The doctor asks for no information other than your age. From just that piece of information, the doctor gives you a clean bill of health, suggests that you exercise 3 times each week, eat a well-balanced diet, thanks you for coming, and reminds you [...]
We recently sent our quarterly letter to clients and the following is an excerpt that offers our thoughts on the merits of making an investment forecast for 2014, or any year, for that matter. The fact that both the economies and the stock markets of the developed nations performed so well last year might lead [...]
The following is an excerpt from the letter we wrote to clients in July 2013 and provides a worthy lesson in behavioral investment. Peter Bernstein in Against the Gods states that the evidence of investor behavior “reveals repeated patterns of irrationality, inconsistency, and incompetence in the ways [they] arrive at decisions and choices when faced with uncertainty.” [...]
My recently turned 5-year old son began playing chess over a year ago and it has been instructive to see his approach to the game develop. Immediately recognizing the importance of the queen, he developed a foundational strategy that revolved around that piece — establishing his own pieces to capture the opposition’s queen early in [...]
