From the monthly archives:
Headlines from the past week: Last Friday: Deal Fears Increase as Market Tanks [source] This Monday: Dow Slides 203 Points [source] Tuesday: US Stocks Explode Higher, Dow Surges Almost 900 Points [source] Wednesday: Dow Decked in Final Minutes; 280-Point Gain Becomes 74-Point Loss [source] Thursday: What GDP Slowdown? Dow Advances 189 [source] Jeez. What a [...]
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In a comment on yesterday’s post, Aaron asked what a person’s portfolio should look like as he approaches and enters retirement. The question of what percentage of your portfolio should be devoted to each class of investment is known as “asset allocation.” The most common answer given to the asset allocation question is, unsurprisingly, ”It depends.” [...]
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One of the very first things you need to figure out when you’re starting to invest is what time frame you’re looking at. Are you going to need this money six months from now, two years from now, or 30 years from now? The answer makes a big difference as to which type(s) of investments [...]
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Five Cent Nickel recently wrote a post about making money in a flat market by investing through the decline. Nickel shows that if you dollar-cost-average into a fund (index or otherwise) and the market declines, then returns to its original point, you will have made money. It’s an excellent post (and quite timely), but it [...]
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If you’ve ever had any thoughts about trying to time the market, I’d suggest first doing some research into dollar-weighted returns and what they tell us. What Are Dollar-Weighted Returns? Almost without exception, when you read about the return that a fund earned over a period of time, you’re reading about time-weighted returns. Time-weighted returns answer the [...]
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The news over the last several weeks has been overwhelmed with headlines about our current financial crisis. Many people have panicked and pulled their money out of the stock market, opting to hold cash instead. Those people seem to be misunderstanding two things: We’re having a financial crisis, not an economic crisis. When you buy [...]
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