Posts filed under “Investing”

Investors: Time Is Your Ally, Not Your Enemy

Today’s column is going to wax a bit philosophical. Stay with me; I think it will be worth your effort.

You don’t really understand time. By “you” I mean humans in general.

This has great significance for investors. They often misapprehend time, are seemingly unaware of its importance, and can’t conceptualize it over the long term. Pardon the circularity, but you exist in the here and now, and — for want of a better phrase — are stuck in the short term.

The past is a hazy set of fallible memories and biochemical impulses, often tinted by the warm and rosy glow of nostalgia. The past can also be darker, traumatic, painful, repressed, still haunting its survivors. Those experiences, often mixed up with one another, color our perspective.

It’s no surprise that our experiences affect expectations for the future. Nor does one need much imagination to see the ramifications the past has for investors. Too many good experiences, or too many bad ones, will change the expectations and risk tolerances for those who put capital to work in risk assets.

When considering the future, it is important to recognize that if one considers a possible outcome it is merely one out of an infinite set of possible outcomes, all unknowable.


continues here: Time Is an Investing Ally, Not an Enemy



Category: Investing, Psychology

Arthur Zeikel’s Investing Rules

Arthur Zeikel, president of Merrill Lynch Asset Management, sent his daughter a letter teaching her some investing basics. Enjoy! Personal portfolio management is not a competitive sport. It is, instead, an important individualized effort to achieve some predetermined financial goal by balancing one’s risk-tolerance level with the desire to enhance capital wealth. Good investment management practices…Read More

Category: Apprenticed Investor, Investing, Rules

How to sort through garbage online investment advice

    My Sunday Washington Post Business Section column is out. This morning, we look at how the internet evolved as a source of bad investment opinion. The print version had the full headline How to sort out the garbage of online investment advice; I like the online version hed, Hey, investment cranks: The Internet never forgets. Here’s an excerpt from…Read More

Category: Analysts, Financial Press, Investing, Really, really bad calls, Weblogs

The University Endowment Sweet Sixteen Bracket

Via Chief Investment Officer, we see this amusing comparison of major university endowments. I am not sure how the winners are determined, other than where a small subset of asset managers would like to one day work. Based on the recent performance data I have seen, there seem to be lots of under-performers. Well, at…Read More

Category: Asset Allocation, Hedge Funds, Investing, Venture Capital

Gold Miners Are No Longer a Proxy for the Metal

Let’s say this right up front: The SPDR Gold Shares Trust exchange-traded fund has killed the shares of the gold miners. For a few years now, I have been very skeptical about gold’s value as an investment (this may seem excessive, but see this, this, this, this,this, this, this, this, this, this and of course this). The primary reason for this is straightforward: Gold is bought…Read More

Category: ETFs, Gold & Precious Metals, Investing, Really, really bad calls

Overall Advisor Satisfaction

From Wealth Management: Advisor satisfaction and loyalty has tumbled at national brokerage firms amid heightened concerns over compensation changes and a lack of confidence in leadership. Source: Wealth Management

Category: Investing

Talk Biz News: 1 Year Anniversary of Masters in Business

It is the one year anniversary of Masters in Business on Bloomberg radio. There is a full discussion of the show after one year at Talk Biz News. Over the course of its first year, the podcast has broken some news, generated some buzz, and generally been a wonderful learning experience for me. I have no…Read More

Category: Financial Press, Investing, Podcast

The Jewish Broker Who Saved America

You know Hancock and Washington and Franklin and Jefferson. You might even know Greene and Knox, Henry and Hale. But it is very unlikely that you know the name Haym Solomon. This is unfortunate, because he’s the guy who arranged financing to keep the Continental Army alive during its darkest days, finding the money to…Read More

Category: Investing, War/Defense

You’re Only Human: Here’s How it Hurts Your Portfolio

I recently had the privilege of sitting down for a chat with Richard Thaler, professor of the Booth School of Business at the University of Chicago. Thaler is widely recognized as the father of behavioral economics. He is perennially on the short list for a Nobel Prize in economics. His observations about how people behave in the…Read More

Category: Apprenticed Investor, Asset Allocation, Cognitive Foibles, Investing

The Ten Harsh Financial Commandments

Mike Batnick is the head of research for RWM; His tumblr is an outstanding assortment of real time analysis, data and perspectives. This was one of my favorite pieces of his:   The Ten Harsh Financial Commandments I) You will not buy low or sell high. II) You will cut your winners and let your losers…Read More

Category: Humor, Investing, Rules