October, 2016

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Living In Multiple Timeframes

The Irrelevant Investor

Stocks always have a positive expected return. With the passage of time however, these expected returns turn into realized returns and obviously they're not always positive. We just can't know what the market will deliver, so it's best to plan and prepare for a wide range of outcomes. This range is determined by a number of factors, including but not limited to the business cycle, valuations, interest rates, inflation, and the collective mood of millions of investors.

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Asset Allocation: Caution Toward High Dividend Yielding Stocks

Brown Advisory

Asset Allocation: Caution Toward High Dividend Yielding Stocks achen Fri, 10/28/2016 - 11:25 Why Have High Dividend Yielding Sectors Done Well This Year? Reach for yield. In response to weak nominal growth, central banks have maintained accommodative monetary policies, pushing interest rates to historic lows. Given this low-yield environment, investors have flocked to stocks that yield more than traditional U.S.

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Asset Allocation: Caution Toward High Dividend Yielding Stocks

Brown Advisory

Asset Allocation: Caution Toward High Dividend Yielding Stocks. achen. Fri, 10/28/2016 - 11:25. Why Have High Dividend Yielding Sectors Done Well This Year? Reach for yield. In response to weak nominal growth, central banks have maintained accommodative monetary policies, pushing interest rates to historic lows. Given this low-yield environment, investors have flocked to stocks that yield more than traditional U.S.

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Please, Give Me a Break

The Irrelevant Investor

2016 got off to a volatile start, it felt like every day was either up or down one percent. In fact, when I made this chart on March 11th, 28 of the first 46 days of the year fit this criteria. Now seven months later, that number has fallen off a cliff, collapsing to just 22%. And just as we all thought would happen, volatility vanished as we got closer to the election.

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Are Robots Replacing You? Keeping Humans in the Loop in Automated Environments

Speaker: Erroll Amacker

As businesses increasingly adopt automation, finance leaders must navigate the delicate balance between technology and human expertise. This webinar explores the critical role of human oversight in accounts payable (AP) automation and how a people-centric approach can drive better financial performance. Join us for an insightful discussion on how integrating human expertise into automated workflows enhances decision-making, reduces fraud risks, strengthens vendor relationships, and accelerates R

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Here’s Why Technical Analysis Gets a Bad Rap

The Irrelevant Investor

There are a lot of people who don't believe in the merits of technical analysis. It doesn't make sense to them that you can look at past price movements and determine future price movements. If stock prices are driven by earnings, how can a chart provide any insight? Well, yea, stocks are driven by earnings in the long-run, but in the short-run they’re driven by sentiment, which can be observed by measuring supply and demand.

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Caught Up in the Minutiae

The Irrelevant Investor

The recent Wall Street Journal article, The Dying Business of Picking Stocks, has generated a lot of buzz over the last day and a half. Despite the tidal wave of money going out of stock picking and into indexes, and the thousands of articles that accompany them, it's still not entirely clear what it means to be an active or passive investor. Here is how I think about it: The active investor attempts to beat a benchmark by either picking individual securities or by timing the market.

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Investment Perspectives | Seeking Yield

Brown Advisory

Investment Perspectives | Seeking Yield. achen. Tue, 10/18/2016 - 11:03. Late September announcements by the Federal Reserve and the Bank of Japan (BOJ) underscore that today’s extraordinarily low interest rates are likely to persist for some time to come. The Fed’s decision to leave rates unchanged means that its quarter-point hike in December 2015 stands as the only increase in more than 10 years despite significant economic progress over the period.

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Genius Does Not Always Understand Itself

The Irrelevant Investor

Today on The Halftime Report's fifth anniversary show, legendary investor Carl Icahn was asked for his thoughts about the market. At one point he says that he looks for "things that are obvious, but not apparent." I thought this was an interesting sound bite, but what does that really even mean? While many of the best investors are able to clearly communicate their philosophy, many of the investors that have earned their legendary status might not be able to get to the root of what drove their

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When Hitler Took Cocaine and Lenin Lost His Brain

The Irrelevant Investor

A good litmus test for whether or not I enjoyed a book is to go back and see how often I marked it up. This one passes the test, my pen got a lot of exercise during the reading of Giles Milton's When Hitler Took Cocaine and Lenin Lost His Brain. I'd guess just 10% of the writing I do in the margins are words and thoughts, the other 90% are stars and underlines.

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Looking Back at the End of a Secular Bear Market

The Irrelevant Investor

This week in 1982 marked a major milestone in the history of the stock market. The Dow Jones Industrial Average closed above 1,000- its highest levels in nearly a decade- and it was on the precipice of saying sayonara to a 16-year bear market. A new secular bull market was right around the corner and the S&P 500 would go on to advance 1650% over the next 17 years, or 18.3% a year.

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Book of Secrets on the Month-End Close

Based off SkyStem's popular e-Book, the book of secrets to the month-end close will be revealed in this one-hour webinar. Learn leading practices when it comes to building a strong and sustainable month-end close that has room to grow and evolve. Learn about the power of precise estimates, why reconciliations are critical to closing the books, how and when to automate, and how the chart of accounts play into your close process.

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A Spec of Sand on a Long Beach

The Irrelevant Investor

Over the weekend I listened to Russ Roberts' interview with Jason Zweig , who made an excellent observation of how vast the financial markets are and how little time investors spend thinking about this: I think if there’s one overriding theme to the book, one of the things I’ve tried to get across in The Devil’s Financial Dictionary is the importance of just being humble before the financial markets.

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Forget Investing Like Buffett, Try Investing With Him Instead

The Irrelevant Investor

John Hempton recently wrote an excellent piece about why nobody can even come close to replicating how Warren Buffett invests. He notes that even the acolytes don't pass the sniff test: Find any investor who models themselves off Warren Buffett and look at what they do. And look at their investments against a twenty punch card test. They fail. They don't even come close.

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The Difference Between Life Insurance and Credit Default Swaps

The Irrelevant Investor

Every day, shortly before nine o'clock, a man with a red hat stands in a square and begins to wave his cap around wildly. After five minutes, he disappears. One day, a policeman comes up to him and asks: "What are you doing?" "I'm keeping the giraffes away." "But there aren't any giraffes here." "Well, I must be doing a good job, then." This little story comes from Rolf Dobelli's wonderful The Art of Thinking Clearly.

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They All Have One Thing In Common

The Irrelevant Investor

All of the great investors, from Seth Klarman and Howard Marks to Warren Buffett and Phil Fisher, have one thing in common- their ability to clearly communicate their philosophy. Great investors need to be masterful in delivering their message in order to see their clients or partners through difficult times. Jack Bogle rightfully gets all the credit for creating the index fund, but he's very underrated when it comes to his ability to effectively communicate.

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Stop Falling Short When It Matters Most—The Elite Advisor’s Playbook to Success

Like being inches from the end zone, many advisors are frustratingly close to their next level of success. You work hard. You put in the hours. But if your closing rate is stuck or your pipeline feels like a revolving door… something has to change. Most advisors are just one small shift away from dramatically increasing their revenue. The difference?

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It’s Getting Out of Control

The Irrelevant Investor

Listen, I'm a huge advocate of actual index funds, but certain fund families are taking way too much liberty with the word "index" these days. The stock market is now being sliced thinner than a piece of prosciutto. If you want to own Apple, but don't feel strongly enough to own the common stock, fear not, for there are 112 ETFs to choose from that hold it.