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Passing Shots

The Fifth Set Blog

Topics: Asset Allocation, Diversification, Efficient Market Hypothesis, Evidence-Based Investing, Fiduciary, Index Investing, Investor Behavior, Long-term investing, Portfolio Management, Random Walk, Risk Premium, Uncategorized

Six Quick Thoughts on the Coronavirus Market Meltdown

As I sit to write this post, the Dow Jones Industrial Average is down just less than 1,000 points.  Concerns around the impact of the Coronavirus on both human lives and economic growth is dragging down global equity markets.  Investors are understandably concerned about what  …read more »

The Guru and The Investor: Act 2 – The Evidence-Based Advisor Strikes Back

Act Two The Setting Following his interview of a hedge-fund manager to see if he should manage his retirement assets, the Investor turns his search to a different type of advisor, for a philosophy based on something called ‘evidence-based investing’.  This seemingly outlandish idea is  …read more »

Global Asset Allocation: Sometimes You Have to Take the Pain

Diversifying a portfolio through the global allocation of various asset classes increases expected return and reduces portfolio volatility over time.  Both worthwhile goals.  But like eating well and exercising to stay healthy, global asset allocation doesn’t happen without a little suffering. In 2014, investors with  …read more »

The Key to Successful Investing

Responding to an email, I came up with this and thought it was worth sharing… The fundamental problem with bond guys is they are programmed to focus on what could go wrong.  Equity guys are programmed to ignore everything that could go wrong.  Strategic asset  …read more »

What’s better than real world stock picking performance? A world with no investment skill….

No, the title doesn’t have a typo. The results of a recent S&P Dow Jones Indices study profiled in a New York Times article found that only 2 out of 2,862 (or 0.07%) broad domestic stock funds performed in the top quartile of funds over  …read more »

Active Manager Folly: Mutual Fund Landscape Study from Dimensional Fund Advisors

A new study  from Dimensional Fund Advisors reviewing the mutual fund industry highlights the low probability game investors and their advisors play when they attempt to select the best active managers. A few of the interesting data points to come out of the study:    …read more »

The Great Divide over Market Efficiency

In a recent Institutional Investor article, authors Clifford Asness and John Liew, offer an interesting and entertaining look at the evidence for and against market efficiency.  Their article takes turns on both side of the debate by highlighting the strengths and weaknesses of work produced  …read more »

What Stock to Buy? Hey, Mom, Don’t Ask Me

A recent New York Times article, written by Harvard economist Gregory Mankiw, offers a great synthesis of the investment principles upon which FSIA manages client portfolios. Efficient Market Hypothesis:  Stock prices quickly reflect publicly available news and information so attempts to outperform the market through  …read more »