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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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2020 and the danger of extrapolation
The contrasts between the first ten months of 2020 and the month of November were vivid. Consider: — At the end of October, the...
Robin Powell
Dec 5, 20202 min read
Why most Robinhood traders earn lousy returns
By LARRY SWEDROE Behavioural finance professors Brad Barber and Terrance Odean have done extensive research on the performance and habits...
Robin Powell
Dec 4, 20207 min read
Practising what you preach
By NICK MAGGIULLI There’s a bit of an issue I have noticed among personal finance experts. Many of them have become wealthy by selling...
Robin Powell
Dec 3, 20204 min read
StockTok — a backwards step for financial education
Some call it StockTok, others FinTok. But whatever you choose to call it, the rise of Generation’s Z’s version of #FinTwit is a cause for...
Robin Powell
Dec 2, 20203 min read
Another sign that market efficiency is increasing?
By JOACHIM KLEMENT Much to the chagrin of value and contrarian investors everywhere, markets in the Western world have increasingly been...
Robin Powell
Dec 1, 20203 min read
Should investors be optimists or pessimists?
To be a successful long-term investor you need the right balance of both pessimism and optimism.
Robin Powell
Nov 30, 20203 min read
The only way to be a buy-and-hold investor
In early 2000, Cathy called Brenda to invite her to an investment seminar sponsored by her CPA. She told Brenda the seminar was part of a...
Robin Powell
Nov 27, 20205 min read
Justice for Woodford Investors
The Neil Woodford saga is a stain on the investing industry. Launched in June 2014, the Woodford Equity Income fund was the most heavily...
Robin Powell
Nov 25, 20203 min read
Why active will continue to underperform
Twice a year, every year, the SPIVA (S&P Indices Versus Active Funds) scorecards across the world show the same long-term results: most...
Robin Powell
Nov 25, 20203 min read
Why cap-weighting dominates
There are all sorts of ways to construct an index. Equal weighting has its fans. Alternatively you can weight by factors — size, value...
Robin Powell
Nov 24, 20203 min read
Five ways to boost your financial resilience
When a crisis comes, panic usually isn’t far behind. Many of us are now living with the threat (or the reality) of redundancy or a drop...
Robin Powell
Nov 23, 20203 min read
The patience of a saint
By ROBIN POWELL “Successful investing takes time, discipline and patience,” Warren Buffett once wrote. “No matter how great the talent or...
Robin Powell
Nov 23, 20206 min read
For every buyer there must be a seller
Jay and Haden were having lunch one day, and the topic turned to the stock market. Haden: I just bought 1,000 shares of Apple. Jay: Why...
Robin Powell
Nov 20, 20205 min read
Getting comfortable with your enough
Welcome to the final part of our series Rethinking Money with CARL RICHARDS. Carl is an expert in human behaviour — specifically in...
Robin Powell
Nov 19, 20204 min read
The best forecaster of all?
If you ever had an ambition to be a stock market forecaster, a quick look back at some of the prognostications made in early 2020 may...
Robin Powell
Nov 18, 20204 min read
Always confident but often wrong
By JOACHIM KLEMENT Note: This post is the result of a conversation I had with Preston McSwain . We found it so interesting that we...
Robin Powell
Nov 17, 20203 min read
Are there any excuses left?
By ALBERTO ALLEGRUCCI For the first time, the SPIVA Europe Mid-Year 2020 Scorecard introduced risk-adjusted performance evaluations...
Robin Powell
Nov 16, 20203 min read
What exactly is an index?
The power of passive investing is that it gives you cheap and efficient access to the market. It does this by tracking the performance...
Robin Powell
Nov 16, 20204 min read
Cost a huge factor in non-profit endowment performance
By LARRY SWEDROE Of an estimated universe of more than 310,000 public non-profit organisations (NPOs), about 35,000 have endowment funds,...
Robin Powell
Nov 13, 20203 min read
Dear valued client
Here at The Evidence-Based Investor, we love reading letters from top City fund managers, and this is one of our favourites. It was...
Robin Powell
Nov 13, 20203 min read
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