Investors have been nervous about the possibility of rising interest rates for a number of years now. Since bond prices fall as interest rates rise, this possibility has many investors worried about their exposure to interest rate risk. A common refrain on reducing this risk that I have heard many times over the years goes…

There was a scary chart flying around a couple months ago showing how basically no asset class was working for investors. These numbers, provided by James Picerno at The Capital Speculator, showed that every major asset class or category showed a negative one year return through early September: This was pretty crazy — stocks, bonds…

The Ivy League endowment funds are some of the most closely watched institutional funds in the world. Whether they’re equipped or not, nearly every other institutional quality fund is trying to replicate what the best and brightest Ivies are doing in their portfolios. With this spotlight comes praise, but also scrutiny.

The investing cycle of good ideas goes something like this: Early adopters find an anomaly and exploit it for huge gains. More and more smart money begins to figure out this apparent loophole and competition means lower profits to go around. Next come the academics with their research papers that get published in the trade…

Last week I talked to a group of college students in a portfolio management class at one of the local universities here in Michigan. The topic was open-ended so I wanted to share with them a few of the things I wish I would have learned in school that weren’t taught or apparent to me…

I’d say once a month for the past 4-5 years I’ve seen some variation of the following prediction: We think there is now an increased risk for the possibility of an event similar to the 1987 Black Monday crash that saw stocks fall 20% in a single day. Here’s a prediction you will never see…

Last week I shared some of my thoughts on hedge funds. In a follow-up to that piece I want to discuss some of the reasons that institutions and wealthy individuals allocate money to hedge funds. I’m not so much concerned with Sharpe Ratios and non-correlated returns. What fascinates me most about the investment business is…

I read the following headline this week: I didn’t need to read any further because the entire idea is based upon a false premise. I don’t know who’s more delusional — the politicians who assume that their policy ideas and regulations will be able to make everything perfect for everyone or the voters who assume…

I spent the earlier part of this week in Milan and Rome speaking to a large group of financial advisors for Banca Mediolanum, a large bank in Italy. It was a great experience, and not just because it gave me the opportunity to travel throughout Italy. I also came away with some interesting takeaways on…

Josh Kaufman, author of the book The Personal MBA: Master the Art of Business, had a great post recently on what he call strategic apathy. Some highlights: In my essay on Status Malfunction, we discussed the problem of allowing the promise of social status to warp our decision-making. We didn’t discuss the solution: making a conscious, deliberate…