October 2016 Presidential Elections and the Stock Market Over the long run, the market has provided substantial returns regardless of who controlled the executive branch. Making investment decisions based on the outcome of presidential elections is unlikely to result in reliable excess returns for investors. At best, any positive outcome will likely be the result of random luck. At worst, it can lead to costly mistakes. To Read More: OPEN PDF ...

September 2016 Back to School Higher education may come with a high and increasing price tag, so it makes sense to plan well in advance. With school back in session in most of the country, many parents are likely thinking about how best to prepare for their children’s future college expenses. Now is a good time to sharpen one’s pencil for a few important lessons before heading back into the investing classroom to...

Today we revisit one of the most refreshing investment ideas we know: the randomness of near-term market returns. Pick a year, any year. If you’re ever tempted to guess how capital markets are going to fare in the year following, all you have to do is take a look at this crazy quilt chart, updated here to reflect 2015 year-end data. That should quickly refresh your memory on how impossible it is...

In some respects, we wish this piece weren’t worth re-posting. We’d prefer it if today’s investors no longer needed to be on the look-out for the opaque fees and conflicts of interest described. Unfortunately, with only a few minor updates, the information is still as relevant today as it’s ever been. So even if you’ve read this before, we recommend revisiting this important message again. For extra credit, you may also...

One favorite guest re-post deserves another. This next one originally arrived just in time for Halloween. Authored by Larry Annello (shortly before our two firms merged into SAGEbroadview), the witching season went well with the theme of the then-new, potential 3.8% Medicare surtax on portions of an investor’s income. At least for the foreseeable future, the Medicare surtax remains alive and well. Fail to plan for it in any given tax...

The MSCI Emerging Markets Index has been negative in 13 of the past 28 calendar years while the S&P 500 Index has only been negative 5 of the past 28 years. Which index had a higher rate of return in this 28 year time period? If you’re catching on to the tricky questions we’ve been posing in our last post and the one before that you might guess that, despite the considerably higher...

In our last post, we shared the first in a trio of videos illustrating the important insights we can draw from Dimensional Fund Advisors’ Matrix Book of historical returns. When viewed close up, the data points found in the Matrix Book may look like just an endless array of random numbers. But just as random dots of paint can generate a bigger picture when viewed from a distance, so can individual...

Client Site | Issue Briefs JUNE 01, 2016 Index Reconstitution: The Price of Tracking Index funds may be a good option for investors seeking investments with low fees. However, an index fund manager’s strict adherence to an index comes at a cost in the form of reduced discretion around trading. Read More: OPEN PDF  ...

A Fund Isn’t an Index (and Why That Matters) In our last post, we covered how not all indexes are created equally, which means that results may vary, even when they are supposedly tracking the same market. In today’s post, let’s look at how and why a fund’s performance may deviate from its closest benchmark index. Indexes vs. Evidence-Based Funds: Similar But Different Take one more step away from the real-life market,...

In recent posts (part I and part II), we covered some of the ways people try to determine how their investments have been doing, and how mismatched measures can generate misguided views. Determining your portfolio’s Time-Weighted Rate of Return (TWR) is one way to reach a relatively accurate sense of how your portfolio is doing compared to its most appropriate benchmarks during particular periods of time. One good two-part series deserves...