In a series of articles about factor investing we’ve defined what we mean by factor investing, we listed the factors and examined their performance, and last time we examined how a strategy can still work when everyone knows about it. The next question we get is, if a strategy works, why doesn’t everyone do it? Why doesn’t everyone earn a... Read More
"Avoiding a problem with foresight and good design is a cheap, highly leveraged way to do your work. Extinguishing a problem before it gets expensive and difficult is almost as good, and far better than paying a premium when there's an emergency. Fretting about an impending problem, worrying about it, imagining the implications of it... all of this is worthless.... Read More
“More investors don't copy our model because our model is too simple. Most people believe you can't be an expert if it's too simple." ~Charlie Munger when asked why more investors hadn't copied Berkshire Hathaway's approach to investing* Value and other forms of factor investing aren’t new. They’ve been around for a while now and are widely documented in the... Read More
Investing well, like any significant endeavor, requires some level of pain to succeed. In a recent article Brad Stulberg, a writer for Outside Magazine and Runner’s World shared the advice he received from his marathon coach. To succeed as a marathoner, he “would need to learn how to be comfortable with being uncomfortable.” Stulberg says he, “didn’t know it at... Read More
Last time we reviewed the advantages of index funds and introduced the concept that different stocks may have different attributes (called “factors”) which lead to different returns. This time, we will specify the four primary factors identified in the research and look at the differences they make to returns. Then we will discuss some drawbacks or things to be aware of when... Read More
Despite the shock Britain's historic vote to leave the EU delivered to the financial markets, the second quarter saw most asset classes deliver positive returns. International stocks were the only major asset class down in the quarter. The best performing asset classes were long-term bonds, REITs, and Commodities. Year to date REITs, Commodities, and Emerging markets lead the way. The... Read More
Factor | noun | fak·ter | A characteristic or element that contributes to a result or outcome. Forty years ago Vanguard founder, Jack Bogle, created and launched the world's first index mutual fund (the Vanguard 500 Index Fund). This fund, and the many index funds created since, have provided an overwhelming benefit to investors and have recently picked up, even more, momentum.... Read More
Good morning! Chances are you woke up today to news of Britain voting to leave the European Union, and more than one ALL CAPS headline screaming that financial markets are plunging. Here’s some perspective: As of this morning, The S&P 500 index is still up 1% year-to-date US Small-cap stocks (IWM) are up 0.7% YTD Emerging Markets stocks (VWO) are up... Read More
I have a bit of a commute and end up spending a lot of time in the car. Despite all this “practice”, I’m still terrible at predicting which lane of traffic is moving best when the all too frequent Portland traffic jam occurs. The left lane is moving, so I cut over only to see the lane I was just in... Read More
“The more you know, the more you know you don't know.” ― Aristotle Intel employees and therefore most of our clients—given our focus on providing ongoing financial planning and investment management to current and former Intel employees—are a sharp bunch. We work with smart people. But, while they know a lot, as Aristotle quips, knowledge makes you more sensitive to and... Read More
