It would be an understatement to say that the election result caught some people off-guard (just not Dave Chappelle or Chris Rock). When these things happen, rational people try to learn from their mistakes by showing some humility. Political discussions are rarely rational, though, so the past week or so has been filled with hindsight bias,…

We had our first ever Evidence-Based Investing Conference with IMN in New York City yesterday. It was a packed house, we had an unbelievable line-up of speakers and it looked like everyone had a good time. Josh provided a nice recap of the event this morning so no need for me to go into detail on…

The Wall Street Journal has a useful interactive tool that can show investors how sensitive their government bond holdings are to changes in interest rates. For example, here’s what things would look like if rates rose 1% from current levels on a number of different sovereign bonds at different maturity levels: And here’s what would…

“Soros is the best loss taker I’ve ever seen. He doesn’t care whether he wins or loses on a trade. If a trade doesn’t work, he’s confident enough about his ability to win on other trades that he can easily walk away from the position. There are a lot of shoes on the shelf; wear…

First of all let me say this — no one knows what’s going to happen based on last night’s election outcome. The people who have been wrong about this outcome for so long will be the same ones who will tell you exactly how it will play out from here. They will be wrong again….

A few weeks ago I wrote about 10 purchases that are worth the money, but threw in a caveat about one of them — buying a house: I think the idea of buying a starter home is one of the worst moves you can make financially as a younger person. Buying a starter home will…

One of the hardest parts about investing is that prudent advice doesn’t always work. Risk management doesn’t always add value. Legitimate strategies can go long stretches where they don’t work very well. Diversification means you’ll always hate something in your portfolio. Junk stocks can outperform high quality companies depending on the starting prices and valuations….

I just finished reading David McCullough’s critically acclaimed book, The Wright Brothers. Going into it I didn’t really know too much about the fascinating story beyond that historic first flight at Kitty Hawk in 1903. That first flight garnered little fanfare at the time (most people just didn’t believe it was possible), but the innovation that followed…

The S&P 500 last closed at an all-time high in mid-August. We’re only 3-4% away from that number and stocks haven’t done much lately, but many investors become very nervous when they hear about all-time highs in the market. After all, the S&P 500 got cut in half following all-time highs in early-2000 and late-2007. Therefore,…

“High prices attract buyers, low prices attract sellers.” There are generally two reasons for a given investment strategy to “work” over time: You earn a premium by accepting more risk. You take advantage of the behavior of other market participants. If I put my rational, textbook theory cap on, number one should make sense. But there’s…