The two most important reasons to own high quality bonds in a portfolio are to provide diversification and to provide capital preservation. A catchy opening line, if there ever was one. Several big finance words (like diversification and preservation), an unexciting topic (bonds), and a subjective statement that may not seem to have actionable implications [...]
Paul Azinger is described by many as the best Ryder Cup captain ever. In 2008, he led what was arguably the least accomplished, least experienced, and least talented team of American golfers in the history of the Ryder Cup event – a 12-person team, missing the injured Tiger Woods and lacking a single player with [...]
The financial services industry has invented and promoted many ways to rip off people. Fake bank accounts, excessive and unauthorized account churning, non-traded REITs, cross-selling high fee products, pump and dump stock schemes, egregious variable annuity sales, and probably another financial abuse strategy exposed in the business section of this morning’s newspaper. In fairness, there [...]
German, Brazilian, English, Argentine, and Spanish football fans, take heart. Football (or in American vernacular - soccer) is quantifiably the least predictable major sport. In no other sport is luck such a critical determinant of the outcome. So you have that going for you the next time you sit down with a Frenchman to discuss [...]
A respected portfolio manager presented recently at an investment symposium where she explained an investment strategy that has consistently maintained zero correlation to stocks. Several times during her presentation, she described why the strategy should be expected to maintain a near-zero correlation to stock markets in the future. During the break that followed, financial advisors [...]
1) Turn off the financial noise machine. Information overload is the norm in today’s world. We demand it. We expect it. Your mind, my mind, and all of our minds are wired to digest information, emotionally respond to the information, and then to do something as a result. This is why and how advertising works. [...]
"Describe your perfect day." Such a simple interview directive rarely fails to provide the most telling of replies. Responses are almost never scripted in advance and usually provide productive insight into what motivates the interviewee, what passions she has, her creativity, or how she organizes her day. Responses from previous experience posing this question (even [...]
I'm learning to fly, but I ain't got wings I recently spoke with a pilot about how he obtains and handles the forecasts for in-flight turbulence in advance of a flight. Before each flight, he gets a fairly precise report of weather along the route and something called a turbulence plot, which is based on [...]
The Astute Angle tackles a question that we commonly receive in conversations with clients. The question comes in many forms but often resembles the following: I have an emergency reserve (or cash stored up for a future home/car/asset purchase) that I want to keep safe but I also want to make a little return on [...]
Earlier this month, we published an article explaining why investors would be well served to organize their portfolios like their kitchens. This process, one that the finance industry calls ‘asset location’, is simply intended to make the most of the existing tax code. The IRS sets the rules with different tax treatment for different account types [...]
