The index investing revolution has made it abundantly clear that many investors are now starting to understand the zero sum nature of active management and the huge hurdle that high fees can present in the fund world. These stats that show the percentage of funds that underperform their benchmarks are commonly known and cited by…

Finance can be a very backwards industry. I understand why so many people outside the world of finance don’t understand what it is that goes on in our industry because many of the things that people believe or do just don’t make any sense. Here are ten of them: 1. People in finance believe that when…

I’m constantly amazed by the number of stories I read each year about wealthy people getting swindled in a Ponzi Scheme or being taken advantage of by a shady financial advisor. The wealthy are by far the biggest targets for fraud and scams and yet they are still far too trusting and nonchalant about who they give their…

A few things I’ve been pondering lately… Why has the average credit card rate remained at ~15%? Interest rates on mortgage, bonds and car loans have all fallen drastically since 2007. Why not credit card rates? I understand these rates need to be higher but why has the spread compared to other credit instruments not…

I recently had the chance to talk with Aaron Watson on his podcast, Going Deep with Aaron Watson. We touched on a lot of different topics, including the writing process, networking and investing. We also talked about the institutional investment industry. Aaron asked me what I thought some of the similarities and differences are between…

The Wall Street Journal shared the results of a survey which shows many investors don’t understand how bond math works:

Information is a double-edged sword in the investment industry. Investors now have access to more opinions, analysis, real-time prices and research than ever before. It cannot be overstated how much this has changed the investment landscape when you compare it to how things once were in the pre-Internet stone age of insider tips, expensive research…

The price of oil seems to be at the forefront of every market and economic conversation these days. That tends to happen when one of the most important commodities on the planet falls 80% in a short period of time. Is it too much supply? Not enough demand? The pricing in of future technological advancements? Speculators?…

Long/short funds are one of those strategies that is wonderful in theory but very difficult to pull off successfully in practice. These funds go long the stocks they think are going to rise and go short the stocks they think are going to fall. So they should be able to make money in a wide…

Morningstar’s Jeffrey Ptak posted some insightful data on Twitter over the long holiday weekend. Take a look at these 10 year performance numbers for actively managed mutual funds once you account for the effects of taxes on investment returns: