Resources

CalPer’s Private Equity Problem

ETF

In an effort to achieve returns that exceed those of the publicly available stock and bond markets, many large pension plans turn to alternative investments such as private equity. California’s CalPers, one of the nation’s largest public pension plans, while using equity index funds for more than one-third of its investments, is increasing its exposure to alternatives. …Read More.

Lessons From 2013: Part IV

Seeking Alpha

Over the last few years we’ve seen a dramatic increase in interest in dividend paying stocks. The heightened interest has been fueled by both the media hype and the current regime of interest rates that are well below historical averages. The low yields available on safe bonds led even many once conservative investors to shift their allocations from safe bonds to dividend paying stocks. This is especially true for those who take an income, or cash flow, approach to investing – as opposed to a total return approach, which I believe is the right approach. …Read More.

Media anoints investment gurus, should you pay attention?

CBS News

Some high profile investors are good at what they do, while others might just be lucky. Often it is hard to differentiate between the two groups, as both can boast of high returns. The media, meanwhile, quick to jump in and snap up a headline, sings the praises of these winning investors, without identifying who among them made strategic moves and who was just lucky — giving the impression that they are all people to watch. …Read More.

The Sad Truth About Hedge Funds

ETF

There are many well-documented problems with investing in hedge funds, and it’s hard to know where to start in pointing them out.

Among them are: lack of liquidity; lack of transparency; loss of control over the asset allocation and thus risk of the portfolio; non-normal distribution of returns (they exhibit excess kurtosis and negative skewness); and they have a high risk of dying (12.3 percent per year from 1994 through 2008). …Read More.

Five Ways to Navigate the Index Fund

As a proponent of passive or evidence-based investing, I am heartened by the growing number of people investing in index funds. According to a Morningstar article, “A Bull Market in Passive Investing,” only 12 percent of U.S. open-end mutual fund and exchange-traded fund assets were invested in passively managed funds as of Nov. 1, 2003. That percentage has risen to 27 percent, and it continues to grow. …Read More.

The Five Deadly Sins of Investing

If you invested dispassionately, using an objective analysis of the historical data, you would invest in a globally diversified portfolio of index funds with low management fees. It’s not that you can’t beat the market by investing in actively managed funds. Every year, some mutual funds outperform their benchmark. However, their probability of doing so over the …Read More.




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