A Vote For Small Cap Stocks

(from Dimensional Fund Advisors’ Down to the Wire blog by Weston Wellington dated 12/22/2016. Weston is a Vice President with DFA, helping to lead the firm’s market research.  He works closely with financial advisors all over the world in helping them to understand DFA’s approach to investment success.)    In the days immediately following the recent US presidential election, US small company stocks experienced higher returns than US large company stocks. This example helps illustrate how the dimensions of expected returns can appear quickly, unpredictably, and with large magnitude. Average returns for US small company stocks… [read more]
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Bonds Away!

Why would I ever want to hold bonds in my portfolio? I’ve been asked that question many times over the last 28 years.  Between June 2004 to December 2005, when the Federal Reserve raised the target rate 13 times in a row, resulting in lower bond prices.  From 1995 to 1999 and 2003 to 2006, when bonds appeared to serve no purpose in portfolios than to dampen the double-digit returns stocks delivered.  More times than not, bonds have been the underdog in investment allocations, and recent stock market returns followed by the Fed’s rate… [read more]
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Beware the Prognosticators

While pondering topics this week for my final post of 2016, I’ve been inundated with periodicals, industry publications and online headlines full of projections about hot stocks, interest rates and where the overall market is headed in 2017. I started linking stories above to make my point, but there are so many, it’s tough to choose just a few.  Linking to one headline suggesting that the Dow is heading to 40,000 would show preference over a claim that it’s headed to 2,000.  If you’re curious, search virtually any financial media site after you’re finished reading.… [read more]
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It Takes a Village

Once again, we’ve entered the special time of year when the days get shorter, temperatures get cooler and our calendars are full of holiday bashes and family get togethers.  The sparkling lights and long lines at the mall can mean only one thing…it’s FAFSA season? Recent changes to the Free Application for Federal Student Aid moved the opening of the filing window back to October 1st from its previous start date of January 1st.  Filers now have from October 1st, 2016 until June 30th, 2018 to file their… [read more]
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