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Discipline Is Critical to Successful Investing

Will disciplined value investing be rewarded long term? Larry Swedroe on the evidence, and current stock valuations. Having a well-thought-out investment plan is the necessary condition for successful investing. However, it’s not sufficient. The sufficient condition is having the discipline to stay the course during the virtually inevitable periods when a strategy underperforms. That, of…

Iconic Report Supports Index Investing

Larry Swedroe reviews results from the new mid-year 2017 SPIVA scorecard. Since 2002, S&P Dow Jones Indices has published its S&P Indices Versus Active (SPIVA) scorecards, which compare the performance of actively managed equity mutual funds to their appropriate index benchmarks. The 2017 midyear scorecard includes 15 years of data. Equity Following are some of the highlights…

Vanguard Debunks Dividend Myth

A new Vanguard study found that a total-return approach is superior to one focused on dividend strategies. Larry Swedroe unpacks the research and explains the downside of a preference for dividends. Dividend strategies have drawn increasing interest from investors around the world as central banks have pursued both quantitative and qualitative easy monetary policies, keeping…

More Hazards of Individual Stocks

If diversification is a free lunch, use the full buffet. In a recent article that highlighted the perils of owning individual stocks, I offered the historical evidence demonstrating how only a small percentage of stocks have accounted for all the gains provided by the market—with the vast majority earning a big, fat zero in aggregate cumulative…

Active Even Fails Institutions

Larry Swedroe unpacks new SPIVA data on institutional managed account performance. Vanguard founder John Bogle’s “cost matters hypothesis” explains why, after subtracting fees, returns from active management tend to be smaller than returns from passive management, as the latter costs less. However, retail investors tend to pay higher advisory and management fees than institutional investors….

Grading the Forecasters

Larry Swedroe on data that reveals the disappointing accuracy of market forecasts. Larry Swedroe, Director of Research, The BAM Alliance The financial media tends to focus much of its attention on stock market forecasts by so-called gurus. They do so because they know that it gets the investing public’s attention. Investors must believe such forecasts…

The Antidote To Stock Market Hysteria

Market forecasters capitalize on our desire to know the unknowable. Tim Maurer, Director of Personal Finance, The BAM Alliance Just for fun, Google the words “market pullback.” There are over 2.2 million results–most of them market predictions–and the first page of results is dominated by calls for an imminent market reversal that the simple desk…

Portfolio Pumping Continues

New research shows that “portfolio pumping” still occurs at mutual fund families. Larry Swedroe, Director of Research, The BAM Alliance Portfolio pumping—also known as “painting the tape” or “leaning for the tape”—is a market-manipulative strategy that mutual fund and hedge fund managers use to mark up their holdings at the end of the quarter by…

Hedge Funds Again Miss the Mark

Larry Swedroe unpacks the data in his latest review of hedge funds’ lagging performance. Larry Swedroe, Director of Research, The BAM Alliance Hedge funds entered 2017 coming off their eighth-straight year of trailing U.S. stocks (as measured by the S&P 500 Index) by significant margins. And for the 10-year period ending 2016, one that included…

Take More Risk in Life And Less in Investing

How will you spend your tolerance for risk? Tim Maurer, Director of Personal Finance, The BAM Alliance “I just really wish I’d taken more risk in my investment portfolio,” said no one–ever–on their deathbed. That may seem like an odd observation, unless you consider the fact that I had the privilege of spending a couple…

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