Pursuing a Better Investment Experience #3: Resist Chasing Past Performance
(Research above shows only 20% of all active mutual funds beat their corresponding index over a 10 year time frame. And of those, only 37% continued over the next 5 years. This is only 205 of 2758 mutual funds that beat their index over a 15 year time frame. It's nearly impossible to pick the right ones) Some investors select mutual funds based on past returns. However, funds that have outperformed in the past do not always persist [...]
Financial Insights for the Self-Employed
Recently, a Park + Elm client asked for some advice on handling his finances now that he is a new business owner. Small business owners are in a unique financial position, so we created a 5 step process to follow during your ownership years. Many self-employed investors won't have the same range of assets that a life-long employee would have at retirement, so planning for your eventual exit from the business is also crucial. 1. Think in Percentages: Think about [...]
Pursuing a better investment experience #2: Don’t try to outguess the Market
Don’t try to outguess the market The market’s pricing power works against mutual fund managers who try to outsmart other participants through stock picking or market timing. As evidence, only 17% of US equity mutual funds have survived and outperformed their benchmarks over the past 15 years. Even so, traditional investment approaches strive to beat the market by taking advantage of pricing “mistakes” and attempting to predict the future. Too often, these approaches prove costly [...]
Pursuing a Better Investment Experience #1: EMBRACE MARKET PRICING
Many investors believe that there may be a way to predict when to buy and sell securities, and it's possible that pricing errors occur in financial markets. But it's clear that investors have a very difficult time consistently exploiting these errors. Over the last five years… About 60% of actively managed large cap US equity funds have failed to beat the S&P 500 77% of mid cap funds have failed to beat the S&P 400 [...]
Pursuing a Better Investment Experience
Stay tuned-in to our blog for our Ten Part Series highlighting TEN decisions that can help investors target long-term wealth in capital markets. We'll cover topics from market pricing, efficient markets and diversification; to investing with your emotions, and the Media challenging your discipline. Check back tomorrow for the first of the series: EMBRACE MARKET PRICING Enjoy this Ten principle guide to pursuing a peaceful and positive investment experience.
Quarterly Market Review
Our most extensive market report...the Quarterly Market Review is now available, featuring world capital market performance and a timeline of events for the past quarter. Gain information on the performance of globally diversified portfolios last quarter, and check out the featured topic: GDP Growth and Equity Returns. Q2 Market Review