A World of Opportunities: The Benefits of Global Diversification
It’s obvious why a U.S.‑based investor may think it’s better to stay away from international investing, but you don’t get the full story by just looking at the short-term returns of different asset classes in isolation. You need to take a long-term perspective and think about how everything affects your total portfolio.
A Brief History of Reverse Mortgages in the U.S.
Reverse mortgages have a relatively short history in the United States, beginning in a bank in Maine in 1961.
How Should an Overvalued Market Affect Your Investment Plan?
Markets don’t move capriciously. They move because something new has happened – new information has arisen. The tricky part is that we don’t know what new information will arise.
Total Return vs Income Investing: Same, but Different
Retirees can take 2 main approaches to spending from portfolios. 1) Focus on income and dividends produced in the portfolio, a.k.a. “income investing.” 2) Sell assets as appropriate to meet spending needs. For your portfolio, they’re basically the same thing. But, from your point of view, you should be aware of one difference: focusing on income investing can make your portfolio less diversified.
Whether Gold Prices Are Up or Down, You Should Stay Away
Along with China and the potential implications of rising interest rates, many stories have come out this week heralding the fall of gold and the new world we now live in as a result. It seems only a few years ago, we were simply deluged by articles about the merits of gold, the frailties of fiat […]
Is a High CAPE Cause for Alarm? Part 2: Valuation-Based Asset Allocation
Discussion around PE10 focuses primarily on how to adjust expectations about future stock market returns based on its value. A more controversial topic is whether it is beneficial to adjust strategic asset allocation in response to where PE10 is currently situated.
How to View Social Security vs. a Long-Term Stock Portfolio
MarketWatch columnist and colleague Robert Powell recently shared an intriguing question with me from one of his readers on the merits of the Social Security retirement payout versus the returns on a conservative, long-term stock portfolio.
Taking Risks That Make Sense
More risk does not mean more return, but more return follows more risk. Which risks make sense for you?
CoRI Index: A Tool to Lock-in Annuity Prices without Annuitizing
The CoRI Indexes are bond funds whose prices are calibrated to move in lock-step with the price of an income annuity with a 2.5% COLA which will begin income at age 65.
Sequence Risk vs. Investment Risk
A lot has already been written about the sequence of returns risk confronting retirees. But the full implications of sequence risk have not been completely internalized. Retirees become more vulnerable to investment volatility, because as they withdraw from their portfolio they may find themselves locking in investment losses. It’s the opposite effect from dollar cost averaging.
