Stocks

August Finance Reads-Sharpe, Buffett, Trump and More

August Finance Reads-Sharpe, Buffett, Trump and More

By in Debt, Investing, Links, Stocks | 2 comments

With the Chinese Yuan falling, Donald Trump rising, Greek debt still in the media, there’s plenty to think about. For a quick diversion, here’s some of the articles I’ve been reading recently. I hope you enjoy them as much as I did.  “Valuable Lessons From Warren Buffett’s Letter to Shareholders“, Cullen Roche of Pragmatic Capitalism – Cullen does a great job of pulling out the key takeaways from Buffett’s last years annual report. My favorite was “stop paying high fees”. My ‘ah-ha’ lesson was “risk is not volatility”. He referenced Buffett is saying that risk is actually not meeting your...

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How to Benefit from Cyclical Investment Markets-MBA Lecture Recap

How to Benefit from Cyclical Investment Markets-MBA Lecture Recap

By in Advanced Investing, Economics, Investing, Mutual Funds, Stocks | 10 comments

Can You Benefit from Cyclical Investment Markets? In today’s market, a short term interest rate of 1% is highly coveted and difficult to find. The annualized 10 year total return on the S & P Market index of 7.60% during the last ten years is 2% below the historical returns of the 1928-2014 time period. In spite of the juicy market returns of the past 3 years, you may wonder, where are the average stock market returns of 9%? What happened during the first decade of the new millennium to bring down returns and can you benefit from cyclical investment...

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How to Measure Investment Risk & Protect Against it

How to Measure Investment Risk & Protect Against it

By in Advanced Investing, Asset Allocation, Bond, Economics, Investing, Stocks | 9 comments

Investing is Risky The Investments class I teach at a local university focuses on investing risk and return. We talk about the risk that you’ll lose money if you invest and your stock and bond funds decline in price. There’s also the risk that your purchasing power will erode from inflation. According to a recent Fortune-CNN article food prices increased 2.6% last year. Although, in my region, it seems as though the food increases were quite a bit more. Although the CPI (consumer price index) reported a seasonally adjusted increase of 1.7%, your personal inflation rate varies based upon...

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Rebalance Your Asset Allocation Guide

Rebalance Your Asset Allocation Guide

By in Advanced Investing, Asset Allocation, Bond, Investing, Mutual Funds, Personal Finance, Stocks | 13 comments

Earn More by Rebalancing Your Asset Allocation Raise your had if you want an extra one quarter percent return on your portfolio every year? It takes about an hour and you can get this extra return every year. I know, it’s not much, but with interest rates in the basement, every little bit helps. Before you learn how to rebalance your asset allocation, let’s review a bit of investing background. What is Asset Allocation? “Don’t put all of your eggs in one basket.” This old adage describes  the best way to boost investment returns. Diversify your investments among stock...

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How to Prepare for the Coming Inflation

How to Prepare for the Coming Inflation

By in Bond, Economics, Investing, Stocks | 21 comments

 When is Inflation Coming?  “Inflation is as violent as a mugger, as frightening as an armed robber and as deadly as a hit man.” Ronald Reagan It’s been more than 4 years since I wrote this piece, and there’s still no inflation. What’s up with that? Does that mean we won’t be having any more inflation, ever? Are we in a ‘new normal’? Or does it mean that I stink at predicting the future? Likely, I am not great at predicting the future. But with the current inflation rate at -0.1% for the 12 previous months, according to USinflationCalculator.com,...

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Is a 7% Future Long Term Return Achievable?

Is a 7% Future Long Term Return Achievable?

By in Asset Allocation, Bond, Investing, Reader Question, Stocks | 15 comments

Asset Classes Matter In a previous article, I received the following comment, which inspired me to answer the question, “Is a 7% future long term return achievable?” Little House commented: “I like how you broke down the asset classes percentages of stocks and bonds. Do you really think we can expect an average return of over 7 percent over the next 30 years? My husband and I were just discussing how savings rates are so low and have been for 10 years. We remember when we were kids in the 80′s that they were up to 12 percent! We can’t fathom...

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