An article titled 3 Stocks That Can Do Well in This Economy was recently submitted for my weekly roundup. I didn’t include it, as I wanted to discuss it more thoroughly. The author, Mark Riddix, made a compelling case for the success of the three companies in question. But I wasn’t entirely satisfied as to [...]
From time to time I see financial writers lamenting the explosion in ETF popularity over the last few years. They complain that the original idea of index investing (i.e., buying and holding a low-cost, diversified portfolio) has been perverted in favor of a focus on trading ETFs for short-term profits. Frankly, I disagree. I think [...]
For the most part, people are risk averse. We prefer not to take on any additional risk unless there’s an increase in expected return. On occasion, however, we’re not risk averse. We’re risk seeking. When we go to a casino or play the lottery, we’re taking on risk despite the fact that our bets have [...]
Index funds are mutual funds designed to track a specific index (the S&P 500 or the Barclay’s Capital Aggregate Bond Index, for instance). This is in contrast to most mutual funds, which are run by fund managers seeking to beat the market rather than just match it. Because index funds seek only to mimic the [...]
Presumably as a way to fight back against Schwab and Fidelity offering commission-free trades on certain ETFs, Vanguard announced today that beginning immediately, Vanguard brokerage clients will be able to buy (and sell) shares of Vanguard ETFs without trade commissions. Given Vanguard’s extremely broad line-up of ETFs, this is big news for many buy & [...]
Two wrongs don’t make a right. Similarly, two poor investment decisions don’t add up to one good investment decision. In the last few weeks, I’ve come across two articles discussing scenarios in which a homeowner was “underwater” on his/her mortgage. In each case, it was indicated that selling the home is a poor choice because [...]