“In spite of promising lower returns than most other investment classes, bonds earn inclusion in portfolios by providing protection against the extraordinary circumstances of a financial crisis or economic deflation.” – David Swensen If you missed Part 1 of my common sense series on bonds please read Investing in Bonds to learn about the different…

“The essence of investing is the management of risks, not the management of returns.” – Benjamin Graham When people talk about the market, stocks get all of the attention and headlines. Stocks have historically been one of the highest performing financial assets while also displaying high amounts of volatility. There are also many instances where…

“I never blame myself when I’m not hitting. I just blame the bat, and if it keeps up, I change bats. After all, if I know it isn’t my fault that I’m not hitting, how can I get mad at myself?” – Yogi Berra I have spent a lot of time talking up the advantages…

“If there is time to reflect, slowing down is likely to be a good idea.” – Daniel Kahneman Thinking Fast and Slow is a fascinating book by Nobel Prize winner Daniel Kahneman. It is full of interesting studies that have been performed over the years to learn how to think about thinking and how we…

“I’ve got all the money I’ll ever need, if I die by four o’clock.” – Henny Youngman Common sense reader mailbag: I would like to increase the percentage of my salary that I put into my 401(k) but I’m nervous with the stock market trading at all-time highs? Should I wait for a pullback in…

Disclaimer: I do not know your risk profile or time horizon as an investor so I cannot possibly gauge your suitability for the investment strategy I am about to discuss. I am simply showing how this can be done for those that determine that they have the time horizon and tolerance to take on the…

“The return OF capital is more important than the return ON capital.” – Old Investing Proverb A reader asks: I’m getting sick and tired of earning such low interest rates on my savings account. Should I invest in stocks or bonds to get a better return on this money? What are my alternatives if rates…

“With broad asset classes, we want to take advantage of the mathematics of mean reversion. And so when any asset class runs too far ahead, it automatically gets trimmed back.  And when it falls too much, it automatically gets bought. It just happens “automatically” through math. Look, we know any individual stock can go to zero. But…

“Investors should remember that excitement and expenses are their enemies.” – Warren Buffett Index funds and ETFs make the most sense as an investment vehicle for investors for a number of reasons. They have lower expense ratios than active mutual funds. They are more tax efficient. They trade less so they have lower transaction costs.

“Every day I get up and look through the Forbes list of richest people in America.  If I’m not on there, I go to work.” – Robert Orben The wealth divide in this country has been growing for a number of years as the difference between the haves and the have nots continues to widen….