The past decade has not been particularly kind to diversifiers; a handful of large U.S. growth stocks generally outperformed international stocks, smaller companies and Value-oriented investments. As the gap widened, diversification may have looked less like prudent risk management and more like an unnecessary constraint. But recent strength across formerly lagging market segments offers a […]
When you invest in a specific stock, sector, theme (or meme), you’re basically saying you think it’s a better bet than all the other options out there. That is, any choice to invest in one thing is at the same time a choice not to invest in all other things. How sure can you be […]
Global equity markets have seen increased volatility as the war in Iran has prompted regional contagion. A consequent surge in oil prices has lifted concerns that cost-of-energy flow-through will lift going-forward inflation; the rise in interest rates that has come as a result has pressured bond markets. But the Iran war is only the latest […]
We’ve written often of our preference for “factor” investing in equities, an approach that leads us to variously “tilt” portfolios toward characteristics that reflect observable “risk premia” in that they can be seen to have led to outperformance over time. There’s no guarantee that outperformance will come, though; there’s a risk that the premium won’t […]
Regularly investing over time may allow one to take advantage of market volatility, rather than simply suffer it. As stocks bounce up and down, investors may find that market drawdowns present opportunities to invest at lower prices. Perhaps easy to default, then, to a dollar cost averaging plan (DCAP)—the practice of investing a particular sum […]
