It is not often appreciated by ordinary investors, but there is a cozy relationship between the media and the brokerage industry. They both want you to believe that certain individuals have uncanny powers of accurately predicting the future.  Just flick on CNBC and you can listen to a host of ‘experts’ telling you what is going to happen next, economically speaking, and how to position your portfolio accordingly.  They will even give you their ‘hot’ picks.  What is not known by much of the ordinary investor community is that these folks pay handsomely for this precious TV face time.

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One of the great myths of the investment world is that you can build a successful long-term strategy around a carefully chosen small number of stocks that are perceived as generating good earnings growth year after year. Just why this myth refuses to die may be a testament to the power of hope over experience. (Read on …)

The sharp rally in stock prices over the last thirty days may or may not be the beginning of a new bull market. Global stock prices have moved decisively higher from their low point in early March despite an avalanche of discouraging financial news.  A number of analysts and market technicians have dismissed the surge in prices as too much too soon, and expect the downturn to resume in the near future.  (Read on …)

Many ‘gurus’ have been saying how the ‘buy and hold’ strategy for investing is now dead. Whenever people start talking about the death of something, particularly with investing, it is often the moment it’s about to surge. The classic example of this is Business Week’s “Death of Equities” cover from 1979. (Read on …)

The recent volatility in the stock market has no doubt caused investors a great deal of anxiety. The mood of the markets had been panicked – with steep declines one day, followed by market rallies the next – as investors try to make sense of the broader economy and what lies ahead. What we have witnessed in the markets has been nothing short of extraordinary in nature.

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This has been a difficult question for many investors to answer. Wall Street and CNBC are always touting the current hot stock or sector in their investment recommendations. New mutual funds are created to satisfy the demand of all the eager investors that want to get on board. What normally ends up happening is that these hot sectors cool down and the investors are left holding the bag as Wall Street moves on to the next hot market. This cycle goes on and on. (Read on …)

Index fund managers, academics, and many institutional investors have recognized the merits of passive investing for decades. However, it wasn’t until the boom of the 1990s that indexing gained popularity among even the most skeptical groups of investors. It was during this time that retail and non-US investors, historically cool to the idea of “settling” for mere market returns, jumped on the indexing band wagon, which had long been occupied by US institutional investors. As the ’90s fade we face the challenges of a new era. Market volatility has increased. A weak global economy shows little sign of a near-term turnaround. Uncertainty surrounding the duration of the current slowdown and the outcome of the war on terrorism has caused some investors to question their appetite for equities in general. (Read on …)

We are all waiting, it seems, for the next recession. Some indicators suggest that it might be sooner rather than later. Many economists speculate that growth will slow or a recession will occur, because three powerful forces are assaulting economic expansion. (Read on …)

Returns on international stocks have pounded those of their domestic counterparts over the past several years. Generally, you can count on dumb money to follow those returns, especially after a long period of out performance. (Read on …)

The markets give, but investors often don’t receive. It is one of the greatest financial puzzles: Most years, the stock and bond markets generate impressive results, and yet many investors are left bewildered when it comes to their portfolios’ performance. Some blame lies partly with taxes and even more with investment costs. (Read on …)