5 Feb 2018

What the Heck Just Happened?

What the heck happened?  Stocks were rolling along, picking up steam even, when all of a sudden, out of the blue, ‘POW!’, the index hit a wall. In reality though, while the move lower was a surprise, it wasn’t really all that surprising.  It’s true that I couldn’t have told you the week before that stocks would have fallen sharply last week, but a move like this really isn’t out… Read More

29 Jan 2018

The Market’s Next Phase

Almost a year ago to the day, I wrote an article that discussed a well-known quote from a famous investor, Sir John Templeton.  He said that ‘Bull markets are born on pessimism, grown on skepticism, mature on optimism and die in euphoria.’ Clearly, the bull market that we’ve enjoyed for the last nine years was born in the pessimism of the 2008 global financial crisis.  The rally grew on optimism and… Read More

13 Nov 2017

The Canary in the Bond Market?

The recent poor performance of junk bonds received a lot of attention last week, culminating in an article in the Wall Street Journal that asked, ‘Are High Yield Bonds the Canary in the Coal Mine?’ The two largest junk bond ETFs, HYG and JNK, saw their largest weekly pullbacks since August, falling just short of a percent each on unusually large volume. There are several reasons for the selloff: Barron’s… Read More

11 Sep 2017

Cliff Asness Says, Fire Your Mechanic

This article was originally published on June 3, 2014.  In my humble opinion, it holds up well; although I am disappointed that value stocks still haven’t turned around more than three years later.  As much as I don’t like that fact, however, the central thesis of my article is that these strategies can underperform for long periods of time.  One of my favorite people in our industry is Cliff Asness,… Read More

29 Aug 2017

Forecasting Expected Returns

“Price is what you pay.  Value is what you get.”  -Warren Buffet How can investors know the value of an investment?  Bond yields remain very low and stocks continue to climb higher across the globe.  Using typical valuation measures, markets everywhere look very expensive.  However, investors continue to pour money into them, so they must see value.  The value of an investment is subject to an uncertain future, so how… Read More

10 Apr 2017

Markets are Quiet, Enjoy Them for Now

The stock market has been unusually quiet this year.  For example, the S&P 500 didn’t fall by more than one percent until March 21st, just before the quarter ended. The Chicago Board of Options (CBOE) Volatility Index (VIX), which measures expected volatility, had the second lowest average reading for the quarter since the index was created in 1992. The chart below plots the VIX over the last three quarters in… Read More

27 Feb 2017

The Words of Warren Buffett

Warren Buffett released his annual letter to shareholder on Saturday and, as always, it was a delight to read.  You can find the entire letter here; but today, I thought I would share some of the highlights. *** One word sums up our country’s achievements: miraculous.  From our standing start 240 years ago – a span of time less that triple my days on earth – Americans have combined human… Read More

6 Feb 2017

What is a Border Adjustment Tax?

Most of the time, the topics that I choose for Daily Insights are things that I think I know a lot about.  Sometimes, I write about a topic in an effort to learn more about it. That’s the case today: I had never heard of a border adjustment tax until a few weeks ago, wanted to know more and thought I would share what I’ve learned. Some of you undoubtedly… Read More

30 Jan 2017

A Quote to Consider from Sir John Templeton

I am continually amazed by the huge number of thoughtful and apropos quotes that concern investing.  I’ve been writing and editing our quarterly newsletter, Portfolio Insights, for more than 15 years and I can still find plenty of great quotes without too many repeats. While I enjoy a great quote, I can’t say that any of them rise to the level of being an investing philosophy to live by, except… Read More

3 Jan 2017

2017 Wall Street Forecasts

It’s forecast time on Wall Street and despite the folly of it, individuals and professionals alike pay attention anyway. On average, and according to Bespoke Investment Group, the 15 most prestigious analysts and strategists are calling for a measly five percent gain, which would put the S&P 500 at 2,356 at year end, compared to 2,234 from last week. Collectively, that’s the lowest average forecast since 2005, when the strategists… Read More