February 2016

The regal ostrich, un-sexy majesty

Serious Investors Value the Un-Sexy

Most of us think that we are above average drivers.  Likewise, I have never heard anyone say they are bad at investing.  After experiencing negative returns, the market is to blame or maybe the President of the United States is to at fault if they belong to the “wrong” political party.  After positive returns, I only hear about how great the person is at picking stocks.  Here’s the thing: most people don’t actually know how their investments are performing. I have yet to see a brokerage statement that showed meaningful information.  The typical statement has something like this on one of the first pages: Month starting balance Income Withdrawals/Contributions Value change Month ending Balance The following pages don’t give much more information – usually a list of positions and transactions – so you can see if you had more or less than you started with last month, but how does that compare to…


Fear of the Dark

They come in the night.  From the deepest dark, they reach out.  Searching.  Your fear sustains them.  Panic slides you deeper into their grip and dawn will never break for you.  You can light bonfires and set a watchman to keep them at bay, though.  Light is their enemy and a diligent guard will quickly put them on their way to seek an easier meal. Market selloffs can mean dark times.  This is the easiest environment for investment product sellers to hunt for their prey – you (and me).  I get cold calls and emails daily ranging from what worked last year (but is probably a dog now) to today’s buzzword (liquid alts and smart beta these days).  They know that down markets motivate people to take action, even if it’s against their best interest.  It’s easy to forget that the market will turn around and a long-term perspective will carry…