Insights

How to Avoid Disaster

September will mark the 25th anniversary of the failure of the massive hedge fund, Long-Term Capital Management (LTCM), and my podcast feed is filling up with retrospectives. One podcast featured Roger Lowenstein, the author of When Genius Failed, which is considered the definitive work on the subject. I read it when it came out in 2000 and once again in subsequent years, and it’s a great book that I thoroughly enjoyed…. Read More

ChatGPT Did Not Write This Insight

I resisted downloading ChatGPT until last week because I’m increasingly skeptical about the benefits of technology. Don’t get me wrong; I love technology. I use my iPhone more than I care to admit and have to be mindful about not using it too much (and I still do). The problem isn’t technology – it’s people. It’s like food – we need it to live, and the right foods in the right amounts… Read More

The March Towards Exchange-Traded Funds

Acropolis was an early adopter of exchange-traded funds (ETFs). As the name implies, an ETF is a fund that trades on an exchange. It’s like a mutual fund in that it is generally diversified, but like a stock, it trades throughout the day. When we got going in 2002, ETFs were about ten years old. The first version was State Streets Spyder, which still trades today with the ticker SPY…. Read More

Successful Trading at Acropolis

For nine years now, Acropolis has hired a third party to evaluate the market impact of our trading. Whenever we talk to clients about rebalancing, tax-loss harvesting, raising cash for withdrawals, or putting new money to work, our traders work with the portfolio management teams to figure out what trades ought to occur and then the traders take those trades to market. Last year, our traders went to market almost… Read More

New Rules Could Mean New Strategies

I’d like to meet the person in Washington who comes up with the silly names for laws just for the purpose of creating a catchy acronym. Case in point is the newest iteration of the Setting Every Community Up for Retirement Enhancement, better known as the Secure 2.0 Act. The Act has a number of provisions that raise financial planning issues for a lot of people. For example, were you… Read More

You might not be surprised to learn that I love investment-related podcasts. I listen to about a dozen of them fairly regularly and am often impressed by the guests they get. A recent episode of the Meb Faber Show featured an hour-long interview with Professor Gene Fama. Fama is probably the most influential academic in modern finance after creating the Efficient Market Hypothesis in the early 1970s and co-creating the… Read More

Low Volatility Investor Expectations

These are trying times for investors. We all know that markets are risky, and there are extended periods of bad times, but historically, the good times have more than offset the bad times, and the risks have been worth taking. In an attempt to ease the pain of down markets, some investors have pursued what is commonly called low-volatility funds. Other names for similar strategies include minimum variance and minimum volatility, but… Read More

The Second-Most Important Element of Retirement Planning

I’ve focused on bear markets for the last two weeks because the stock market briefly dipped into bear market territory a few weeks ago. Since then, markets have recovered some of what was lost, although there is still a way to go to get back to even. One of my colleagues pointed out that as long as your portfolio could reliably provide the cash flow that you need to live… Read More

The Week When Not Much Happened?

The volatility last week was startling. The S&P 500 was up 2.99 percent on Wednesday but then fell -3.56 on Thursday. It was just as startling as the week before, when the S&P 500 rose 2.47 percent on Thursday, only to fall by -3.63 percent on Friday. Or the week before that, when stocks rose 1.61 percent on Tuesday and fell -1.48 percent on Thursday and -2.77 percent on Friday…. Read More

Socially Responsible Investing

There is a lot of hype in our industry about ESG investing, which is the new way to talk about socially responsible investing (SRI). The new name, ESG, stands for Environmental, Social, and Governance. The last time I wrote about socially responsible investing was in 2014, and you can read the article here. I wrote that we don’t use ESG funds (which I called SRI back then) unless clients direct… Read More