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If you want to lose weight, eat less and move more. If you want to make money in the stock market, cut your losses short and let your winners run. But neither losing weight nor making money is as simple as aphorisms make it seem. Not even Jesse Livermore, who is probably the most widely quoted trader of all time, was able to follow his own advice. This is from the excellent Jesse Livermore- Boy Plunger (emphasis mine): "It seems incredible that knowing the game as well as I did, and with an exp
The Advisory | March 2016 Insights on Markets and Investments. achen. Tue, 03/01/2016 - 11:37. So far in 2016, investors have encountered some of the worst market turbulence in many years. The key to weathering the volatility is staying true to a long-term investment plan. In this issue: Through the Storm. Stock market volatility has spiked in response to immediate market concerns about energy prices, weakening economic growth in China and changes to monetary policy, as well as momentous capital
It's probably no surprise that the S&P 500 high quality index has outperformed the S&P 500. But what is surprising , to me anyway is that the S&P 500 low quality index has also outperformed the S&P 500 (as well as the high quality index!). How is this possible? It has everything to do with the structure of the index; interesting things happen once you break the link between size and weighting.
The S&P 500 always gets the majority of the attention and understandably so, as these 500 504 stocks comprise ~80% of the total U.S. market cap. But something interesting recently happened in the Russell 2000, which represents just ~8% of the total U.S. market cap. The Russell 2000 has made no progress over the past thirty months. But in this thirty month period, it has experienced a 26.4% decline on a closing basis, certainly qualifying as a bear market.
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
Wouldn't you love to know how people actually invest. It's one thing to follow somebody on Twitter or to read their blog, but at the end of the day we have no way of knowing if that person actually practices what they preach. I want to lay my cards on the table, and share how I invest my money. First, I keep 6 months worth of living expenses in cash, you never know when the rainy days will come and I think this is a good rule of thumb.
“Statistician, a person who lays with his head in a oven and his feet in a deep freeze stating, On the average, I feel comfortable"- Bruce Grossman Peter Bernstein describes the average and standard deviation of returns perfectly, he said: "The greater the variance or the standard deviation around the average, the less the average return will signify about what the outcome is likely to be.
Emerging Markets have been a serial disappointment. Over the past five years they've been a money loser and were a huge opportunity cost relative to U.S. stocks. But alas, there is at least a glimmer of hope that things might be changing. Emerging Markets (EEM) have spent the last 184 days below the 200-day moving average. In that 184 day period, EEM experienced a decline of 29%.
Emerging Markets have been a serial disappointment. Over the past five years they've been a money loser and were a huge opportunity cost relative to U.S. stocks. But alas, there is at least a glimmer of hope that things might be changing. Emerging Markets (EEM) have spent the last 184 days below the 200-day moving average. In that 184 day period, EEM experienced a decline of 29%.
My first job out of college was with a life insurance financial planning company in Manhattan. At first it was a pretty seductive, high energy environment. Unfortunately reality reared its ugly head pretty quickly thereafter. I couldn't understand why life insurance was the right product for everybody, whether they were 30, 40, 50 or even 2. Yes, we were encouraged to sell whole life policies to grandparents; it was beyond gross.
"The main purpose of the stock market is to make fools of as meny men as possible." -Bernard Baruch The other day I pointed out the unusual weakness out of small cap stocks. I also added the caveat that it was likely not indicative of anything, which is about as close to a prediction as I'll make in writing. [link] For the second time in four days, small caps are showing unusual movement relative to large caps, except today it is in the exact opposite direction.
While many people have recently said it has never been a better time to be an investor, one can also make the case that it has never been as confusing. Between index funds and mutual funds, hedge funds and fund of hedge funds, ETFs and ETNs, financial advisors and robo advisors, there is an overwhelming amount of options out there for investors. Brian Portnoy's hits the nail on the head in his excellent book, The Investor's Paradox.
Thinking and behaving for the long term is one of the most difficult challenges an investor is faced with. Although simply buying and holding has produced fabulous returns, this type of investing requires you to commit to several sizable drawdowns, likely to be over fifty percent in some cases, over the course of your investing career. For many, this is too steep a price to pay.
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.
"Patterns are the fool's gold of financial markets" Benoit Mandelbrot In 1976, a group of economists discovered that stocks tended to do well in January, small cap stocks in particular. Small cap stocks returned 26% in January of 1975 and an 18% in January of 1976, enough to get anybody's attention. This came to be known as the January effect, and like many other fundamental-less anomalies, shrunk upon its discovery.
That depends on what you mean by "due." Are we due in the sense that it has been a while since the last recession? Sure. Since 1926, recessions have happened on average every 59 months. We're currently 80 months removed from the last recession. Are we due in the sense that stocks have gone too far? Sure. The S&P 500 has risen on average 111% in between recessions; currently stocks are up 142% since June 2009.
"It is wise to take admissions of uncertainty seriously"- Daniel Kahneman Apple is the biggest and one of the most carefully watched stocks in the world. It's 50-day average volume is 49,069,563 shares, or roughly $4.8 billion a day. The buyer and the seller of every one of those shares believes they are receiving a good enough price which compels them to pull the trigger.
I want to share an amazing piece of history that I found in the New York Times archive from 1882. It pertains to Teddy Roosevelt, who in addition to being the youngest President of the United States, was also the youngest New York assemblyman. In one of Roosevelt's first acts as an assemblyman, he would take on the corrupt Jay Gould, as well as a judge and Gould's conspirator, Judge Westbrook.
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?
The only thing gold miners and biotech stocks have in common is their extreme performance over the past few years. While miners lost 76% of their value between 2011 and 2015, biotechs gained 241%. Below you'll see the 31-week rate of change of gold miners versus biotechs, which has spent most of the last few years deeply in the red. However, this ratio has jumped through the stratosphere, rocketing 144% in just the last 31 weeks.
We've seen some explosive moves since the S&P 500 bottomed on January 20th. 241 S&P 500 stocks are up double digits, 29 stocks are up more than 20%, and 8 stocks are up more than 50%. Below is a further dissection of recent S&P 500 performance from the bottom. Here are the returns of the S&P 500 broken down by market cap, from largest to smallest.
"There's a quick and easy way to test whether an activity involves skill; ask whether you can lose on purpose. In games of skill, it's clear that you can lose intentionally but when playing roulette or the lottery you can't lose on purpose." - Michael Mauboussin I don't believe that stock picking is entirely a game of luck, but the fact that there is a large amount of luck involved is indisputable.
A new paper was recently published titled The Market for Financial Adviser Misconduc t by Mark Egan, Gregor Matvos, and Amit Seru. It takes a deep dive into financial adviser shenanigans and quantifies everything from repeat offenders, to misconduct across firms, to the consequences of misconduct. This is a must read for anybody in the industry. Below I've clipped some of the data I found to be most interesting.
Managing spend is more than a cost cutting exercise – it's a pathway to smarter decisions that unlock efficiency and drive growth. By understanding and refining the spending process, financial leaders can empower their organizations to achieve more with less. Explore the art of balancing financial control with operational growth. From uncovering hidden inefficiencies to designing workflows that scale your business, we’ll share strategies to align your organization’s spending with its strategic g
Well that was a fun day. Let's get right into some of the data. 100% of large cap financials were positive, which has now happened twice over the last six days. XLF is up 11.6% from the lows made on February 11th. The transports, which were a major laggard all of 2015, are up 17.3% off their January 20th lows. All but two transports were positive today.
Through The Storm. achen. Tue, 03/01/2016 - 15:11. Stock market volatility has spiked in response to immediate market concerns about energy prices, weakening economic growth in China and changes to monetary policy, as well as momentous capital-market shifts during the past 20 years. In times like these, investors earn their stripes by staying focused on their long-term goals.
A Lift Amid Headwinds: The Appeal of Mortgage Bonds. achen. Tue, 03/01/2016 - 15:28. With the Federal Reserve tightening for the first time since 2006, investors may generate competitive returns from the comparatively stable market for mortgage-backed securities. "Know your borrower!”—a lesson from the subprime mortgage meltdown last decade—is now the key to achieving outperformance through investing in the even-keeled market for government-backed mortgage bonds.
‘The Ultimate Mobile Device’: Redefining the Automobile. achen. Tue, 03/01/2016 - 15:52. For more than a century, automakers have provided a way to find adventure and new possibilities just beyond the horizon. Now the industry is also trying to satisfy consumers’ Web-focused wanderlust. Global automakers—latecomers to the digital highway—are now trying to hog its fast lane.
Speaker: Duke Heninger, Partner and Fractional CFO at Ampleo & Creator of CFO System
Are you ready to elevate your accounting processes for 2025? 🚀 Join us for an exclusive webinar led by Duke Heninger, a seasoned fractional CFO and CPA passionate about transforming back-office operations for finance teams. This session will cover critical best practices and process improvements tailored specifically for accounting professionals.
Present at the Creation: Early-Stage Venture Capital. achen. Tue, 03/01/2016 - 16:02. While headlines often focus on Uber, Airbnb and other private companies valued at more than $1 billion, we are looking beyond the so-called unicorns to find opportunities for bigger returns in early-stage venture capital. In 2011, a Tel Aviv-based startup called Cyvera began developing cybersecurity software deploying the coding equivalents of barriers and traps to thwart hackers staging potentially devastating
Back in Fashion: The Jackie Onassis Trust. achen. Tue, 03/01/2016 - 16:14. Jacqueline Kennedy Onassis structured her will with an approach toward charity and her heirs that, given the outlook for interest rates, is back in style. Through her will, former first lady Jacqueline Kennedy Onassis left behind a sizeable inheritance for her children while incorporating an innovative estate planning tool aimed at meeting her philanthropic goals.
Global Leaders Investment Letter - Q1 2016. ajackson. Thu, 03/31/2016 - 09:50. Global Leaders Strategy Investment Letter - Q1 2016. In their inaugural letter, the Global Leaders team shine some light on why they have a strong focus on customers and why high and sustainable ROIC is an important factor in their bottom-up analysis. . . Download the Letter. . .
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