Should You Diversify?

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As 2019 approaches, and with US stocks outperforming non-US stocks in recent years, some investors have again turned their attention towards the role that global diversification plays in their portfolios. 

For the five-year period ending October 31, 2018, the S&P 500 Index had an annualized return of 11.34% while the MSCI World ex USA Index returned 1.86%, and the MSCI Emerging Markets Index returned 0.78%. As US stocks have outperformed international and emerging markets stocks over the last ...

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Market Volatility

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After a period of relative calm in the markets, in recent days the increase in volatility in the stock market has resulted in renewed anxiety for many investors.

From September 30th to November 20th, the US market (as measured by the Dow Jones Total US Stock Market Index) fell -10%, resulting in many investors wondering what the future holds and if they should make changes to their portfolios. While it may be difficult to remain calm during a ...

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Midterm Elections: What Do They Mean for Markets?

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It’s almost Election Day in the U.S. once again. For those who need a brief civics refresher, every two years the full US House of Representatives and one-third of the Senate are up for reelection. 

While the outcomes of the elections are uncertain, one thing we can count on is that plenty of opinions and prognostications will be floated in the days to come. In financial circles, this will almost assuredly include any potential for perceived impact on ...

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Nine Experts, Four Surprises, and One Million Dollar Bet

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Weston Wellington

Vice President   

Dimensional Fund Advisors

 

January 2018

DOWN TO THE WIRE

In 2017, we were again reminded of the importance of following an investment approach based on discipline and diversification vs. prediction and timing. As we gear up for the new year, we can look at several examples during 2017 that provide perspective on what guidance investors ...

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Tax Loss Harvesting: Opportunities and Obstacles

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So much of investing is beyond our control (picking stock prices, timing market movements and so on), it’s nice to know that there are still a number of “power tools” we can employ to potentially enhance your bottom line. Tax-loss harvesting is one such instrument … although the analogy holds true in a couple of other ways: It’s best used skillfully, and only when it is the right tool for the task.

The (Ideal) Logistics

When properly applied, ...

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Election: 70 Days and Counting – Presidents, Politics and Your Portfolio

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Last week I visited Gettysburg and toured the battlefields which represent the turning point of the civil war and reaffirmed the principles of which the United States is built. Over 150 years later those fields still speak as loudly as they did when Abraham Lincoln memorably spoke about a “new birth of freedom” for America in the Gettysburg Address. While this year’s election is nowhere as monumental as the battle of Gettysburg; it will also determine ...

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Parenting Your Wealth in Uncertain Times

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In the face of political drama at home and violence abroad, it’s certainly been a summer for trying our patience, hasn’t it? For anyone who has ever been a parent or a child – that is, for everyone – there are several comparisons we can draw between good parenting and good wealth management. For both, plenty of patience is one of the most important qualities to embrace.

Patience Is Your Greatest Strength

As an investor, you probably have plenty ...

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Our Relationship with Investment Risk

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Is investing riskier than usual these days? In our experience, probably not. It just feels that way because of the constant bombardment of information. If there is such a thing as “normal” in this world of ours, risk is certainly built into the definition.

In Morningstar’s Quarterly Economic Commentary, Francisco Torralba, Ph.D., CFA described the [f]inancial markets as having lived in a heightened state of alert for the last two years. Markets had a boomerang first quarter. Quick ...

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Investing for Retirement Income: Part III: Total-Return Investing

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pie-chart

 

As we’ve discussed in the first two parts of this three-part series, we do not recommend turning solely to dividend-yielding stocks or high-yield (“junk”) bonds to support your retirement income, even in low-yield environments. So what do we recommend? Today we’ll answer that question by describing total-return investing.

PART III: TOTAL-RETURN INVESTING FOR SOLID CONSTRUCTION

If you think it through, there are three ...

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Investing for Retirement Income: Part II: High-Yield Bonds

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In Part I of our three-part series on investing for retirement income in a low-rate environment, we explained why we don’t advise bulking up on dividend-yielding stocks as a reliable way to generate retirement cash flow. Like the Three Little Pigs’ straw house, dividend-yielding stocks can disappoint you by exhibiting inherent risks just when you most need dependability instead.

Another popular ...

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