February 2019

Killer Vees

The S&P 500 just rocketed 18% higher in only 44 days. A bounce of this magnitude makes a mockery of risk management. This is the ninth time stocks have experienced a killer vee bottom since 1970. I refer to them as killer vees because they suck for everyone. It makes buy and hold investors sweat…

Numbers Are Not Reality

One of the more unsettling realities of investing is that we cannot rely on data from the past to guide us in the future. It’s important that investors learn about market history and have a basic understanding of math, but beyond that, less might actually be more. In Enough, Jack Bogle wrote: Numbers are not…

Animal Spirits: The Rich Man’s Disease

On today’s Animal Spirits, we discuss: Desks were not meant to be our altars  Wealthy and miserable Berkshire letter This guy actually put $10,000 into Microsoft at its IPO More credit card debt than emergency savings A survey I don’t trust A different look at sequence of returns  Inheritances Cell phone addictions Listen here Charts…

Regret-Adjusted Returns

According to a recent Morningstar report, “shareholders of major U.S. stock market index funds have about 40% foreign exposure, as measured by corporate revenues.” Does this mean that U.S. investors already have plenty of overseas exposure, eliminating the need to diversify into international stocks? Let’s go to the scorecard. The S&P 500 destroyed international stocks since 1970,…

These Are the Goods

Articles Where’s the Venn diagram overlap between why writers write and why readers read? By Meb Faber Think of the U.S. stock market as one holding company named USA, Inc By Ehren Stanhope Investors do not like to bet on underdogs By Ryan Krueger How many thousands of quarterly investment letters have gone out to…

The Future of Real Estate

When I bought my apartment in 2015 I hired a broker. When I went to sell, however, I did it on my own. Sort of. I’ve never sold a piece of real estate before so why did I think I could pull this off? Let me tell you about my experience on the buy side:…

Animal Spirits: Denominator Blindess

Today’s Animal Spirits is presented by YCharts Mention Animal Spirits to receive 20% off (*New YCharts users only) Stories discussed: Zillow wants to flip your house Are auto loans the next subprime? Student loans for people over 600 How big should your next egg be? New Mauboussin Charlie Munger has no filter Wealthfront cash account Tax returns…

Un-Complicating Investing

I spend the majority of this space writing about the challenges associated with investing. I even wrote a whole book on it. Why am I such a Debbie Downer when it comes to this stuff? Well, maybe it’s sour grapes. Look, I tried for years to beat the market, couldn’t do it. Then over time…

The Purge

Do investors really need to hear from management every 90 days? The 13-week cycle of reporting earnings and issuing guidance breeds short-term thinking and invites the wrong kinds of questions. Going from quarterly reporting to a biannual system could allow for a sharper focus on running the business rather than wasting time on the business…

These Are the Goods

Articles Crowded trades work until they don’t By Michael Mauboussin Every recession begins with a softening of the data, but so too does every weak patch in the economy. By Tim Duy Investors are typically led to develop their factor return expectations with little more than an extrapolation of the factor’s past paper-portfolio returns. By…