13 Nov 2014

Long‑Term Care Insurance: Protect Your Nest Egg — Should You Buy It?

You spend your entire working career putting aside money to have a sufficient nest egg in retirement so that you can do the activities you enjoy with the people you care about most. One of the risks to that goal is the possibility that you or your spouse will become ill and need some type of long‑term care (LTC) for an extended period of time. Long‑term care can be extremely… Read More

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24 Oct 2014

Anatomy of a Short Squeeze

Although it’s come and gone, I am still thinking about the price spike in the 10-year US Treasury note that occurred last Wednesday. Someone from Blackrock told me yesterday that it was the most volatile day for the 10-year since 1980, which implies that it was more volatile than 99.91 percent of all of those trading sessions. You can see from the chart that all of wilding was in the… Read More

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23 Oct 2014

You Can Be a Stock Market Genius

Years ago, before the crisis, I read a terrific book by investor Joel Greenblatt titled, ‘You Can Be a Stock Market Genius: Uncover the Secret Hiding Places of Stock Market Profits.’ Usually a title like that is a turn off for me because it implies that investing is easy and that someone’s behind the curtain who knows the secrets to making money that no one else knows. Despite the title,… Read More

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22 Oct 2014

Choosing a Trustee

There are many reasons to establish trusts including the efficient transfer of wealth, avoiding probate, philanthropic commitments, tax reduction, or protecting assets, among other things. Ten years ago, the tax reduction benefits were applicable to more people because the estate tax exemption (the threshold where estate taxes kick in) was $1.5 million. Today, the exemption is $5.34 million and, therefore, affects far fewer people. That doesn’t mean that you don’t… Read More

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20 Oct 2014

Finding Higher Yield

In any investment, the total return is comprised of the income earned and capital appreciation. The yield on the bond market is relatively low, so it’s been good news for bond investors that interest rates have fallen because that means that prices are higher, providing some capital appreciation in a low yield environment. But that’s also the bad news: we’re in a low yield environment. Last year, when interest rates… Read More

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14 Oct 2014

Crude Oil Falls: A Tax Cut for Everyone

At this point, the S&P 500 is still positive for the year, unlike all of the other (smaller) US asset classes or developed markets overseas, which are all down. Emerging markets and REITs are also up this year, but emerging markets are recovering from a loss of -3.86 percent last year and REITs are benefitting from the surprise drop in interest rates. When we think about asset class results, like… Read More

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13 Oct 2014

Dirty Words of Finance

A little before my time, comedian George Carlin did a bit called ‘seven dirty words’ that were unsuitable for television. Although the words are fairly commonplace now, I’m glad that the networks and basic cable keep them off of the air until my kids are in bed. Finance has a few dirty words as well, but unlike Carlin’s list, I can use them here to describe how we mostly, but… Read More

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6 Oct 2014

Help Your Kids and Grandkids with a 529 Account

Last year, Fidelity Investments did a study called the College Savings Indicator to measure how families deal with college costs. They found that 26 percent of parents will pay for all college costs, four percent will not pay for any college costs and the remaining 70 percent plan on paying a portion of college costs.  In short, college is still a high priority. On average, these families expect to pay… Read More

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2 Oct 2014

Patience is a Virtue

Every investment strategy requires patience. Let’s say, for example, that you believe, as we do, that small cap stocks tend to outperform large cap stocks over time. You’ve got the empirical data going back to 1926 that clearly shows, with statistical significance, that small stocks outperform large ones. Small stocks are more volatile than large stocks, but that fits elegantly with the theory that to earn a higher return, you… Read More

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30 Sep 2014

My Experience with Alternative Investments

We like to say that we eat our own cooking because we invest your money the same way that we manage our own. As one of the chefs in the kitchen, I also eat a lot of things that I’m not ready to serve. For better for worse, my account operates like a test kitchen. Some of the experiments turn out unexpectedly well and it is served out to everyone… Read More

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