February 2019

The Elimination of Risk

Earlier this week I moderated a session at Inside ETFs called “How to capture outperformance and manage risk.” Before tackling the challenges of outperformance, I wanted to ask everybody how they think about the amorphous concept of risk. The responses ran the gamut from “the chance of permanent loss of capital” to “the chance of…

Animal Spirits: The Rich Man’s IRA

Today’s Animal Spirits is presented by YCharts Mention Animal Spirits to receive 20% off (*New YCharts users only) Stories discussed: Record flows out of stock funds The ETF business is not easy A new way to think about stocks in retirement Mind-boggling mistakes Expected returns for private equity The Jim Simons IRA One of the best stock…

The Case for Permanent Life Insurance

I never aspired to be an insurance salesman. I ended up in that role because the barriers to entry are non-existent, and more importantly, because I didn’t have other options. Like a lot of young people who enter that world, I was chewed up and spit out in a short period of time. In any…

These Are the Goods

Articles Even if you are somewhat decent at calling bottoms, you would still lose in the long run By Nick Maggiulli We may now understand the magic, but only the magician could have created the trick. By John Rekenthaler  The law most likely to govern here is the Law of Unintended Consequences By Jason Zweig…

Miss the Worst Days, Miss the Best Days

If you missed just the 25 strongest days in the stock market since 1990, you might as well have been in five year treasury notes. This remarkable data point is almost always followed by “time in the market beats timing the market.” I’m generally on board with this line of thinking, however, I don’t necessarily…

Video Killed the Radio Star

Not sure the title of this post makes any sense but I couldn’t think of something better. I did a hit yesterday with Michael Santoli at CNBC talking about the latest rally and if it might soon fizzle out (spoiler, I don’t know). Why aren’t I smiling you might be wondering? Why aren’t I looking into…

Animal Spirits: Banning Buybacks

Today’s Animal Spirits is presented by YCharts Mention Animal Spirits to receive 20% off (*New YCharts users only) Stories discussed Facebook employees make a lot of money Are we sure buybacks aren’t evil? Google is spending money on…R&D and capex Ben on institutional investors Dalio dumped Fyre festival pitch deck Raise your own interest rate Acorns partners…

Was This a Dead Cat Bounce?

What a comeback. The move over the past few weeks has the bulls saying “We’re still here” (I’m sorry) The fourth quarter decline was so steep, however, that despite the bounce, the S&P 500 is still below its 200-day moving average. What just happened is a fairly rare occurrence, so I put on my data…

These Are the Goods

Articles The difference between the perfect idiot and the man with perfect foresight By Drew Dickson Greed is expecting back more than you deserve given what you put in By Morgan Housel There is almost always another side By Jack Forehand Their performance was not related to their underlying holdings By John Rekenthaler For that…

The Economics of Owning a Home

Should you rent or should you buy? Whether the item is a car or a home, this is a big question that does not fall neatly into the yes or no pile. There are quantitative and qualitative factors to consider, and like everything else in life, tradeoffs abound. Consider the case of a home. Owning…