Like most 22-year olds, I didn’t know how to invest my 401k when I started making contributions. I asked some of the people that I worked with and they told me to put 100 percent in the company stock, Mark Twain Bancshares (ticker: MTWN at the time, but long gone!). Thanks to the magic of my Bloomberg terminal, I can see why they said to buy the stock: in the… Read More
I heard a funny exchange between Gene Fama and Dick Thaler, two University of Chicago professors that sit on opposite sides of the debate about whether markets are efficient. If you’ve got 45 minutes, I recommend watching the whole discussion by clicking here. As an example of market inefficiency, Thaler told a funny story about a closed-end mutual fund with the ticker symbol: CUBA. The Herzfeld Caribbean Basin fund doesn’t invest… Read More
As you can see in the chart below, earnings season is upon us. While 31 companies have already reported, a full 421 companies report in the next three weeks, leaving the last 48 companies to report during the rest of August and September. Analysts aren’t expecting much out of earnings season and think that earnings will decline by -5.6 percent. According to FactSet, it will be the first time that the S&P… Read More
We are pleased to provide a digital copy of Portfolio Insights, our quarterly newsletter. Table of Contents: Stock Market Summary Bond Market Review Europe’s Brexistential Crisis The Market Hates Uncertainty Compliance Corner: Custody The Big Picture and Fast Facts Click here to read the issue: 2016 Q2 Portfolio Insights
One of the more striking headlines yesterday was that Swiss government bonds now have negative yields out 50 years – that’s right, 50 years! That’s a little hard to fathom, partly because we don’t have bonds that extend that far, but also because 50 years is such a long time. I mean, if I bought a 50 year bond, I’d be in my 90s before I got my money back. Forget inflation, I’m just talking… Read More
One of the phrases that I hear over and over, but simply don’t like, is that ‘markets hate uncertainty.’ Forget the fact that markets are just made up of people and don’t have independent emotions, I’m talking about hating uncertainty. From a theoretical standpoint, let’s think about how uncertainty affects markets. Let’s start with the idea that the value of an investment is the present value of its future cash… Read More
