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

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31 Oct 2016

Equity Risk Dominates Your Portfolio

When I describe ‘balance’ in a portfolio, here or in person, I am almost inevitably talking about an allocation that is somewhat evenly split between stocks and bonds.  I don’t have to specify that I am talking about how much money is in each allocation (forgetting for a moment all of the sub allocations). In recent years, however, some investment managers have pointed out that a portfolio that is evenly… Read More

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17 Oct 2016

Buffett’s Wild Ride

Warren Buffett is rightly considered the most successful investor of all-time.  Not only has his holding company, Berkshire Hathaway, grown at a much higher rate than the overall market, he’s managed to earn exceptional returns for much longer than others who have also earned high returns. I was only able to pull data from 1987, but the last 29 years have been extraordinary for Buffett and his fellow shareholders.  Over this… Read More

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12 Sep 2016

The End of Summer Break

The end of summer was notably quiet, but summer is over and judging from Friday’s market reaction, it appears that volatility may be back. The chart below shows the expected volatility priced in to options as measured by the Chicago Board of Exchange (CBOE) Volatility Index (VIX). You can see the volatility was high at the start of the year when we suffered a 10 percent correction.  Expected volatility cooled… Read More

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25 Aug 2016

Dow Falls 1,000 (One Year Later)

Last year at this time, deep fears about China’s economy caused US markets to drop sharply.  The Shanghai market -8.5 percent one day drop spread to our shores and the Dow Jones Industrial Average (DJIA) fell -1,000 points in a single day. The week before, markets that had dropped by the massive one day plunge sent all of the stock market indexes into a correction, generally defined as a decline… Read More

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24 Aug 2016

Investors Behaving Badly

Yesterday, when discussing the volatility of emerging market stocks, I have to admit that I was a little surprised by the year-to-date return, which is up 16.15 percent through yesterday as measured by the MSCI EAFE EM index. That’s pretty amazing because three months ago, the index was basically flat for the year – the entire return occurred almost exclusively since the Brexit (not that they are related – I… Read More

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15 Jul 2016

Earnings Season is Upon Us

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

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27 Jun 2016

Friday Could Have Been Worse

While markets were obviously down, one piece of good news is that they weren’t chaotic.  You may think I’m grasping at straws here for a silver lining, but wild macro events can cause markets to get sloppy and that didn’t happen Friday. Last August, when markets were selling off, the heavy trading volume caused a number of stocks and ETFs to behave erratically in what some people described as a… Read More

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24 Jun 2016

Britain to Leave EU: Keep Calm and Carry On

I stayed up later than usual last night to see how the vote would turn out and by the time I turned out the lights, it looked like the Leave camp was going to win. Personally, I thought that they would vote to Remain, partly because of the polls, partly because I thought it was in their best economic interests and partly because voters in Scotland and Quebec stayed in their… Read More

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25 Aug 2015

Dealing with the Market Rout

Despite the frenetic trading in the markets yesterday, I was heartened as I talked and emailed with clients who seemed largely unfazed by the steep selloff over the last week. Not only was no one panicking, a handful of clients (not just mine, but for the firm), sent in new money to capitalize on lower prices while a number simply wanted to rebalance their existing assets, which at this point… Read More

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