High Fees - Source: Marketwatch.com
Research focuses on two big investor errors: (1) The inability to separate past performance is not an indicator of future results, so they don't mind paying more, and (2) not realizing how fees impact portfolio value over time.
Here is the actual research paper.
University of Pennsylvania - Mutual Fund Fee Impact
Thursday, June 21, 2012
Saturday, June 16, 2012
The Impact of Fees on your portfolio
I am a strong believer that nothing will impact your portfolio more over time than:
(1) Avoid steep declines
(2) Active management of passive investments that meets your risk profile through tax and placement strategies
(3) Modest Fees
Here is a blog post on the impact of fees
WSJ: The Impact of Fees
(1) Avoid steep declines
(2) Active management of passive investments that meets your risk profile through tax and placement strategies
(3) Modest Fees
Here is a blog post on the impact of fees
WSJ: The Impact of Fees
Thursday, June 14, 2012
Status Quo and the Seven Dwarfs - Notice what you are noticing..
I don't believe you can time the markets, but that doesn't mean I don't like to follow the markets and try to do it.
I also don't believe there is any "Holy Grail" to market timing and that you need to triangulate to get the best possible fix. Simultaneously, I think it is destructive to look at too many indicators.
I look at six things to help me find the intermediate to long-term trend of the market. Most of them now are 'yellow' or 'red'.
If I don't believe you can time the markets, why do I bring this up? Because there are two mistakes you can make with risk - having too much and having not enough. If you have too much, and you experience the risk that is in the market - you eventually will. Then you are going to need to either take more risk which may be uncomfortable, or save more, or retire later.
If you don't have a financial plan to help you find the appropriate amount of risk and know when to be alarmed, I have one bit of advice.
NOTICE WHAT YOU ARE NOTICING...
When markets misbehave and you are unprepared, you will naturally have an emotional reaction. Notice your emotions. What I try to do is prevent and avoid this emotional response because you are more likely to make mistakes that will cost you even more money.
Notice your emotional reaction, it is likely one of the "Seven Dwarfs" as I like to call them.
Fearful and his twin brother Greedy
Worry and his twin brother Regretful
and then we have the triplets
Complicated, Complacent, and Apathy
Status Quo and the Seven Dwarfs can make your life much harder than it needs to be.
Status Quo is made stronger by Choice, Ambiguity, and Decision Paralysis. What I try to do is filter these choices down. When you have finite choices and clarity above what those choices delivery, we eliminate ambiguity which allows you to make a good decision.
The Financial Services Industry has a well-earned reputation of hidden fees, unnecessarily high costs, and conflicts of interest which is another reason it is easy to just stay with Status Quo and the Seven Dwarfs.
There is nothing I enjoy more than revealing these costs and having a direct impact on your life.
I also don't believe there is any "Holy Grail" to market timing and that you need to triangulate to get the best possible fix. Simultaneously, I think it is destructive to look at too many indicators.
I look at six things to help me find the intermediate to long-term trend of the market. Most of them now are 'yellow' or 'red'.
If I don't believe you can time the markets, why do I bring this up? Because there are two mistakes you can make with risk - having too much and having not enough. If you have too much, and you experience the risk that is in the market - you eventually will. Then you are going to need to either take more risk which may be uncomfortable, or save more, or retire later.
If you don't have a financial plan to help you find the appropriate amount of risk and know when to be alarmed, I have one bit of advice.
NOTICE WHAT YOU ARE NOTICING...
When markets misbehave and you are unprepared, you will naturally have an emotional reaction. Notice your emotions. What I try to do is prevent and avoid this emotional response because you are more likely to make mistakes that will cost you even more money.
Notice your emotional reaction, it is likely one of the "Seven Dwarfs" as I like to call them.
Fearful and his twin brother Greedy
Worry and his twin brother Regretful
and then we have the triplets
Complicated, Complacent, and Apathy
Status Quo and the Seven Dwarfs can make your life much harder than it needs to be.
Status Quo is made stronger by Choice, Ambiguity, and Decision Paralysis. What I try to do is filter these choices down. When you have finite choices and clarity above what those choices delivery, we eliminate ambiguity which allows you to make a good decision.
The Financial Services Industry has a well-earned reputation of hidden fees, unnecessarily high costs, and conflicts of interest which is another reason it is easy to just stay with Status Quo and the Seven Dwarfs.
There is nothing I enjoy more than revealing these costs and having a direct impact on your life.
Tuesday, June 12, 2012
Monday, June 11, 2012
NY Times - The Biology of Bubble and Crash
NY Times - The Biology of Bubble and Crash
A rather interesting article on how our body responds to market volatility and events.
A rather interesting article on how our body responds to market volatility and events.
Friday, June 8, 2012
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