Category: Hiring a Portfolio Manager
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Fear and Greed is Shifting and Models Don’t Avoid the Feelings
Investors are driven by fear and greed. That same fear and greed drives market prices. It’s Economics 101 “Supply and Demand”. Greed drives demand, fear drives selling pressure. In fact, investors are driven by the fear… Read More
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Actively Managing Investment Risk
The global market declines in early August offered a fine example of the kind of conditions that cause me to exit my long positions and end up in cash. For me, this is a normal part… Read More
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The person who says it cannot be done should not interrupt the person doing it.
– Chinese Proverb Source: https://www.pinterest.com/explore/chinese-proverbs/ Read More
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Warren Buffett’s Berkshire Hathaway Hasn’t Managed Downside Risk
Stephen Gandel shares an interesting observation in Fortune ” Warren Buffett’s Berkshire lost $11 billion in market selloff“. He points out that Buffett’s Berkshire Hathaway (BRK.A or BRK.B) is tracking the U.S. stock indexes on the downside. He says:… Read More
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Stock Market Decline is Broad
We typically expect to see small company stocks decline first and decline the most. The theory is that smaller companies, especially micro companies, are more risky so their value may disappear faster. Below, we view the… Read More
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What You Need to Know About Long Term Bond Trends
There is a lot of talk about interest rates and bonds these days – for good reason. You see, interest rates have been in a downtrend for decades (as you’ll see later). When interest rates… Read More
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Why So Stock Market Focused?
Most investors and their advisors seem to speak mostly about the stock market. When they mention “the market” and I ask “what market?” they always reply “the stock market”. Why so stock market centric? It… Read More
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My 2 Cents on the Dollar
The U.S. Dollar ($USD) has gained about 20% in less than a year. We observe it first in the weekly below. The U.S. Dollar is a significant driver of returns of other markets. For example,… Read More
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Conflicted News
This is a great example of conflicted news. Which news headline is driving down stock prices today? Below is a snapshot from Google Finance:: Trying to make decisions based on news seems a very conflicted… Read More
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Asymmetric Nature of Losses and Loss Aversion
Loss Aversion: “In prospect theory, loss aversion refers to the tendency for people to strongly prefer avoiding losses than acquiring gains. Some studies suggest that losses are as much as twice as psychologically powerful as… Read More