Category: Absolute Return
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Essence of Portfolio Management
“The essence of investment management is the management of risks, not the management of returns. Well-managed portfolios start with this precept.” – Benjamin Graham The problem is many portfolio managers believe they manage risk through their investment selection.… Read More
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Investor Optimism Seems Excessive Again
When someone asks me why I hold so much cash or against a market decline, it always corresponds to extreme optimism readings in the most basic investor sentiment indicators. Investors have poor long-term results because they… Read More
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What in the World is Going on?
The trend has changed for U.S. stocks since I shared my last observation. On January 27th I pointed out in The U.S. Stock Market Trend that the directional trend for the popular S&P 500® U.S. large cap stock index… Read More
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Risk comes from not knowing what you are doing so wide diversification is only required when investors are ignorant.” – Warren Buffett
Sourcce: http://www.azquotes.com/quote/1259463 Read More
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The U.S. Stock Market Trend
When we define the direction of a trend, we consider the most basic definitions. Higher highs and higher lows is an uptrend. Lower lows and lower highs is a downtrend. If there is no meaningful… Read More
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Extreme Fear is Now Driving Markets
On October 27th I wrote in Fear and Greed is Shifting and Models Don’t Avoid the Feelings that: The CNN Fear & Greed Index shows investor fear and greed shifted to Extreme Fear a month ago as the popular U.S. stock indexes dropped… Read More
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The public, as a whole, buys at the wrong time and sells at the wrong time. The average operator, when he sees two or three points profit, takes it; but, if a stock goes against him two or three points, he holds on waiting for the price to recover, with oftentimes, the result of seeing a loss of two or three points run into a loss of ten points.”
Charles Dow (November 6, 1851 – December 4, 1902) was an American journalist who co-founded Dow Jones & Company Read More
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The Stock Market Trend: What’s in Your Boat?
The stock market trend as measured by the S&P 500 stock index (the black line) has had a difficult time making any gains in 2015. SPY in the chart below is the SPDR S&P 500 ETF seeks… Read More
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The Starting Point Matters
For long term investors who buy and hold, the risk/reward expectations are sometimes very, very, simple. If you bought the long term U.S. Treasury index via the iShares 20+ Year Treasury Bond ETF (Symbol: TLT)… Read More