In many ways the stock market makes no sense. You would assume that half of all stocks would outperform a market index while the other half would underperform. Then all you would have to do is pick from the top half and avoid the bottom half, make massive amounts of money and go buy an…

Following my recent piece on the future of the hedge fund industry, a reader asked: Interest rates are too low and stock market volatility is too high so we have to hold some alternatives in our client portfolios. Our problem is how do we benchmark these funds? S&P 500? 60/40 portfolio? A hedge fund index?…

One of the most impressive long-term stock market statistics has to be the historical 30 year returns on the S&P 500: This graph shows the rolling annual 30 year returns from the corresponding start dates. The worst 30 year return — using rolling monthly performance — occurred at the height of the market just before…

The increase in computational power has definitely made life easier for the finance industry. Tasks that once would have taken hours and hours to do by hand can now be done with the push of a button and calculated through algorithms or formulas on a spreadsheet. At times it feels like I have more market and…

There’s a piece in the New York Times today which posits that the cycle may be turning in Silicon Valley. Well-known venture capitalists such as Chamath Palihapitiya and Bill Gurley are cited as those who have been tempering expectations for the tech industry. Here’s Gideon Lewis-Kraus what’s been driving things lately: What has driven inflated…

Many consider the gains seen in the stock market since 2009 the most hated bull market of all-time. As they say, stocks climb the wall of worry, and people have been mighty worried about pretty much everything over the past seven years or so. But it’s getting harder and harder to correctly judge sentiment anymore…

My colleague Josh Brown pointed out a surprising fact on fund flow data last week. It turns out the most heavily purchased ETF in 2016 is the iShares MSCI USA Minimum Volatility ETF (USMV). This relatively unknown fund has taken in $4.5 billion this year alone, an increase of 50% in assets from the end of…

There was a ton of chatter about the hedge fund industry in the past week from both well-known hedge fund managers and the asset allocators who invest with them. A sampling: The CIO of the NY state pension says HF fees are unfair. Larry Robbins says that HFs have been hit by waves of fear,…

In the U.S., over $13 trillion of institutional capital relies on consultants for advice on which funds to invest in. Pensions, endowments, foundations and other large pools of money utilize consultants for a range of services, most notably picking different outside money managers to invest in on their behalf. Research shows that investment consultants as…

Plenty of people in the finance world were talking about the study put out last week by the giant consulting firm McKinsey on the prospects for lower market returns over the next 30 years than we’ve experienced over the past 30. Here are the numbers from the report: And here’s the takeaway from Bloomberg: Turning 30…