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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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How good are we at predicting our longevity?
By LARRY SWEDROE When developing a financial plan, one of the most important assumptions is life expectancy. And while no one knows...
Robin Powell
Dec 21, 20214 min read
50 laws of investing
By ROBIN POWELL Investing isn’t easy, but nor is it particularly complicated (or at least it shouldn’t be). To quote William Bernstein in...
Robin Powell
Dec 20, 20214 min read
How do environmental news stories affect stocks?
By LARRY SWEDROE Investors are expressing their concerns about climate change by dramatically increasing investments in companies with...
Robin Powell
Dec 17, 20217 min read
Reasons for optimism post COP26
So, good COP or bad COP? Reactions to the 2021 UN Climate Change Conference have certainly been mixed. But, says JASPREET DUHRA from S&P...
Robin Powell
Dec 15, 20213 min read
Greenwashing is being used to attract inflows, study confirms
ESG is one of the fastest growing investment trends in history. Bloomberg Intelligence estimates that by 2025, more than $50 trillion...
Robin Powell
Dec 14, 20214 min read
The economic gender gap is due to close in 2288
It’s the single biggest gap in wealth management. And it involves half the world’s population. 50 years since the feminist revolution of...
Robin Powell
Dec 13, 20214 min read
New evidence on recency bias in trading and sports betting
By LARRY SWEDROE The basic hypothesis of behavioural finance is that behavioural biases lead to markets making persistent mistakes in...
Robin Powell
Dec 10, 20215 min read
How will a strengthening dollar affect emerging markets?
The US dollar has been strengthening, and commentators are predicting that it will strengthen further. The Federal Reserve is expected to...
Robin Powell
Dec 9, 20213 min read
Hedge fund alpha is negative and declining
By LARRY SWEDROE The history of the hedge fund industry is an interesting one. 25 years ago, approximately $300 billion of assets were...
Robin Powell
Dec 7, 20214 min read
How should an infallible vaccine for Omicron be priced?
By CRAIG LAZZARA Over the past ten days or so, global financial markets have been roiled by the discovery of the “Omicron” COVID-19...
Robin Powell
Dec 6, 20212 min read
How will the rise of ESG affect stock returns?
There is clearly a strong demand by investors for portfolios that reflect their ethical principles. Bloomberg Intelligence estimates that...
Robin Powell
Dec 3, 20214 min read
It's having friends, not money, that makes you rich
By JASON BUTLER When I was a teenager in the 1980s, my parents ran an enormous pub in southeast London.It was a real drinkers’ pub and...
Robin Powell
Dec 2, 20213 min read
Do capture ratios actually tell us anything?
By LARRY SWEDROE Investors concerned about risk care about more than just volatility. They also care about tail risk, including how...
Robin Powell
Nov 30, 20214 min read
ESG: the measurement challenge
The recent Glasgow climate change conference heard eye-watering numbers on the investment needed for the world to achieve net zero...
Robin Powell
Nov 29, 20214 min read
Private debt funds: how have they performed?
By LARRY SWEDROE The Global Financial Crisis led to increased bank regulation and a reduction in banks’ risk appetite. The reduction in...
Robin Powell
Nov 26, 20214 min read
Active share has been a big disappointment
We've written many times about so-called closet index funds. These are funds that describe and market themselves as actively managed —...
Robin Powell
Nov 24, 20215 min read
The disposition effect: why traders sell at the wrong time
To be a successful active investor, you don't just need to buy the right stocks at the right time; you also have to decide which stocks...
Robin Powell
Nov 23, 20216 min read
Australia the only exception as fund managers flop again
All of the mid-year SPIVA scorecards from S&P Dow Jones Indices are now in. The reports summarise the performance of domestically focused...
Robin Powell
Nov 22, 20212 min read
Tobacco stocks: who owns them and why do they outperform?
By LARRY SWEDROE Investing in the shares of firms with morally questionable business models (“sin” stocks, such as tobacco, alcohol and...
Robin Powell
Nov 19, 20217 min read
Taking a stand: confirmation bias
Since the pandemic began, confirmation bias has been identified by financial advisers as the second most prevalent investor bias and one...
Robin Powell
Nov 17, 20214 min read
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