On the topic of using moving averages to avoid risk, one question I often get is, What actually would have happened over the past couple of decades? Everyone has an interest in avoiding a 2000 or 2008, but everyone also knows that market timing doesn’t work.
May 20, 2014
Check out Brad’s May 20 interview on CNBC’s Worldwide Exchange, where he offers his thoughts on recent U.S. equity market growth and Treasuries.
One of the major causes of stock market losses is unforeseen declines that make people sell out—often at the worst time. This is one of the reasons I’ve focused much of my recent research on using drawdown (instead of return variance) as a measure of risk. In my opinion, it provides a better metric for real-world investment performance.
The first question you might have, upon seeing that headline, is what’s the difference? Data is simply facts, without meaning or context. Information can be used as a basis to make decisions; it can be acted on.
If you ever want to be amused, get a cat to watch an ink-jet printer while it’s at work. I now have a laser printer at home, which still seems to fascinate the cat, but there’s no comparison to the ink-jet. Something about the print head scurrying back and forth under the cover must remind them of a mouse . . .
May 15, 2014
Recently, several readers have written in with questions about House Bill 2847—specifically, the Foreign Account Tax Compliance Act (FATCA) section, which takes effect in July.
May 14, 2014
There are no blockbuster news stories today, but several items play into the theme of how “old normal” things have become.
May 12, 2014
As I write this Monday morning, stocks are up quite a bit on the day, with the S&P 500 pushing even closer to a new all-time high. The headline on Google Finance reads “U.S. Stocks Advance Amid Deals on Optimism Over Economy,” and all seems right with the world.
The markets seem to be rallying as the Russians dial down the Ukraine confrontation. After a couple of dips, it looks like we’re edging back into a risk-on mode, with Putin apparently deciding that he has what he needs and it’s time to back off.
