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How much passive investing is too much?
Warnings that index funds have broken the stock market all imply a threshold: a share of the market at which price discovery fails. Nobody making the argument names it. Owen Lamont, writing in the Financial Analysts Journal, argues that no such number exists short of complete passive ownership, and that what actually determines whether prices stay informative is who is left doing the trading. His case, the strongest peer-reviewed research against it, and what the performance
Robin Powell
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Trading driven by attention leads to poor returns
By LARRY SWEDROE The field of behavioural finance has produced a large body of evidence on the poor performance of individual investors,...
Robin Powell
Jun 3, 20225 min read
How to spot a financial fraudster
Australians have been riveted by the story of a “financial adviser” who defrauded her clients, friends and family of around $30 million....
Robin Powell
Jun 2, 20222 min read
Two words: Neil Woodford
Robin writes: I love this tweet. Not my original one, but the reply from @FroglandMark, aka Crafty Git. It dates from December 2016,...
Robin Powell
Jun 1, 20222 min read
The takeover effect: what it is and how to benefit
By LARRY SWEDROE Research on the cross-section of stock returns has found that takeovers provide explanatory power. For example, Martijn...
Robin Powell
May 31, 20224 min read
Is ESG investing a panacea or Chinese Communist conspiracy?
By ROBIN POWELL After years of extraordinary growth, the industry that's built up around environmental, social and governance, or ESG...
Robin Powell
May 30, 20225 min read
Generating alpha sows the seeds of its own destruction
Generating alpha is what active fund managers are paid to do. The problem is, when a manager succeeds, more people are persuaded to...
Robin Powell
May 27, 20225 min read
Why use a financial planning firm?
By ROBIN POWELL Over recent weeks we’ve been featuring How to Invest, a new documentary series produced by Regis Media. It was commissioned by Wealth Matters, an evidence-based financial planning firm based in the Home Counties of England. In the sixth and final video in the series we look at the value of financial advice. Do you really want to do it? I’m asked about this all the time. Do I really need an adviser? Or can I do it myself? My answer is that it depends. Yes, you
Robin Powell
May 26, 20223 min read
Should our banks help us to budget?
As times get tighter, keeping to a budget is becoming important for more and more people. JONATHAN HOLLOW is an enthusiastic user of the...
Robin Powell
May 25, 20225 min read
Index investing: Is replication or sampling best?
By LARRY SWEDROE Investors who choose to invest in the stock market through index funds can do so through one of two main strategies —...
Robin Powell
May 24, 20223 min read
Report highlights blind spots of active fund investors
If you’re investing in a managed fund, how do you know whether you are receiving value for money? How do you know whether the manager is...
Robin Powell
May 23, 20224 min read
Britain's forgotten financial mis-selling scandal
There have been so many financial mis-selling scandals in the UK in recent decades that it’s hard to keep track of them. Freshest in our...
Robin Powell
May 23, 20224 min read
More evidence that alpha generation is shrinking
By LARRY SWEDROE For investors in actively managed funds, the holy grail is finding the fund manager who will in the future be able to...
Robin Powell
May 20, 20227 min read
Low returns ahead: the harsh reality investors face
By ROBIN POWELL Equity investing is very hard for pessimists. You have to be an optimist to some degree to put money in the stock market...
Robin Powell
May 19, 20222 min read
Every investor should think in terms of odds
By JOE WIGGINS Last week I stumbled upon an old Grantland article by David Hill entitled Can’t Knock the Hustle . It is a fascinating...
Robin Powell
May 18, 20224 min read
Take to the streets for better financial regulation
By ROBIN POWELL We’ve written many times on TEBI about the failure of financial regulation in the UK. Even those, myself included, who...
Robin Powell
May 16, 20222 min read
Overpaying to invest can cost you a third of your returns
By ROBIN POWELL Overpaying for anything is a bad idea. But that's especially the case with investing. Paying unnecessary fees and charges...
Robin Powell
May 16, 20221 min read
What if you could predict the future?
The pre-mortem is a behavioural technique that can help investors imagine what might happen in future.
Robin Powell
May 14, 20223 min read
Active share as a predictor of future performance
By LARRY SWEDROE Active share is a measure of how much a fund’s holdings deviate from its benchmark index, and funds with the highest...
Robin Powell
May 13, 20227 min read
Your chief problem and worst enemy as an investor
By ROBIN POWELL One of my favourite investment authors is Benjamin Graham. Widely credited as the father of value investing, Graham was...
Robin Powell
May 12, 20222 min read
When stocks and bonds fall together
By LARRY SWEDROE This year’s significant declines in both stocks and bonds dealt a large blow to traditional 60/40 portfolios that relied...
Robin Powell
May 10, 20224 min read
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