The power of portfolio consistency

From: financial-planning.com

Consistency of portfolio performance is quite an enigma. On the one hand, it’s what many investors, including your clients, will claim they want. On the other, many won’t stick with a portfolio long enough to ever experience its consistency.

Thus, if a portfolio actually demonstrates performance consistency, will anyone actually notice?

Let’s examine the consistency of rolling five-year annualized returns for 12 major asset class indexes and…

Key Takeaways

• Morningstar is tracking 755 strategies from 154 firms with total assets of $73 billion through December 2015.
• Total assets in these strategies tracked by Morningstar fell 3% in the fourth quarter of 2015.
• Global All-Asset strategies retain the top position, collectively accounting for 30% of the universe.
• 2015 was a challenging year for most managers, as they struggled to stand out in a market that…
  
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Why We Think We’re Better Investors Than We Are

From: nytimes.com

From their earliest days, the loosely confederated research efforts that came to be known as behavioral economics spawned a large quantity of studies centered on securities investment. This was not because the field’s pioneers were especially interested in stocks and bonds, nor was the early research commonly underwritten by financial services firms.

Rather, the hive of activity that evolved into its own…

Little Sign of Recession Risk in 2016

From: etftrends.com

A recent CNNMoney survey of economists pegs the odds of the U.S. entering a recession this year at 18%. Considering the duality of the current market turmoil caused by Chinese capital flight and the propensity of news-outlets to give time and space to the most outrageous of economic doomsayers, it’s no wonder investors are scared. Yet, a reasoned analysis of economic…

Investors: Keep your itchy finger off the trigger

From: cnbc.com

What followed the 2008 mass exodus from stock funds? A five-year, cumulative 8.6 percent return for the S&P 500.

How about that 550-point intraday dive last week in the Dow! Did that finally get you to sell?

Or was it one of the many headlines about the trillions of dollars that have been wiped out of the stock market in the worst start for…

Active vs Passive
An Embirical Review for the Taxable Investor

From: Investment Management Consultants Association

The active versus passive debate goes back more than 40 years, to when Jack Bogle, founder of the Vanguard Group Inc., launched the Vanguard 500, the first index mutual fund. Ever since, ever-changing market dynamics have squashed and subsequently rekindled the debate in sequential cycles of boom and busts.

Worried about stocks? Smart investors do these 3 things

From: money.cnn.com

Stocks are off to their worst start to a year ever.

No wonder “sell stocks” is a popular Internet search term these days. The phrase just hit its highest search frequency since 2008 (the year of the financial crisis), according to Google Trends statistics compiled by the blog Daily Shot.

It’s human nature to look at this massive wave of selling and panic.

But…

Don’t be a myopic lemming when the bears growl

From: heraldtribune.com

It is winter, but the bears are not hibernating. They are everywhere.

It is a rare day when their growls are not heard up and down Wall Street. Therefore, take heed and guard yourself against joining the lemmings as they run for the sea, panicked by the sounds of the bears.

Selling off sound stocks needlessly will only turn temporary discomfort into permanent…

Opinion: This time-tested strategy takes investing risk head-on

From: marketwatch.com

In 2015, a diversified investment portfolio didn’t really protect you from the market’s gut-wrenching volatility.

There’s a good chance that 2016 will be a repeat, this time with bond funds suffering through a rising-rate environment, stocks struggling against volatility, emerging and international markets offering little help, and cash and money markets offering only near-zero returns.

As a result, the new year again has investors…

Here’s what happened the last 10 times the stock market disintegrated into a bear market

From: finance.yahoo.com

No one wants to dwell on the bad times, but sometimes it’s important to look back to know what the future may hold.

In JPMorgan Asset Management’s massive guide to global markets, David Kelly and his team included a look at the past 10 times the US stock market has headed into a bear market.

Defined as…