Checking the weather? Looking at a map of the world to plan your next vacation? Guess what—you're using a model. While models can be useful for gaining insights that can help us make good decisions, they are simplifications of reality. One example of a model is a weather forecast. Using data on current and past weather conditions, a meteorologist makes a number of assumptions and attempts to approximate what the weather will be in the future. This model may help you decide if you … [Read more...] about The Reality of Models
2016 Market Review
In 2016, the US market reached new highs and stocks in a majority of developed and emerging market countries delivered positive returns. The year began with anxiety over China's stock market and economy, falling oil prices, a potential US recession, and negative interest rates in Japan. US equity markets were in steep decline and had the worst start of any year on record. The markets began improving in mid-February through midyear. Investors also faced uncertainty from the Brexit vote in June … [Read more...] about 2016 Market Review
Q4 2016 Market Review Posted
You've lived through 90 days of alarming financial headlines and wild speculation of what's to come. Enjoy a few minutes of thoughtful reflection with our Q4 2016 Market Review. Included is the 2016 Annual Market Review. This report features world capital market performance and a timeline of events for the past quarter and total year 2016. It begins with a global overview, then features the returns of stock and bond asset classes in the US and international markets. Our Market Reviews are … [Read more...] about Q4 2016 Market Review Posted
New Market Highs and Positive Expected Returns
There has been much discussion in the news recently about new nominal highs in stock indices like the Dow Jones Industrial Average and the S&P 500. When markets hit new highs, is that an indication that it's time for investors to cash out? History tells us that a market index being at an all-time high generally does not provide actionable information for investors. For evidence, we can look at the S&P 500 Index for the better part of the last century. Exhibit 1 shows that from 1926 … [Read more...] about New Market Highs and Positive Expected Returns
Q3 Market Review Posted
You've lived through 90 days of alarming financial headlines and wild speculation of what's to come. Enjoy a few minutes of thoughtful reflection with our latest Quarterly Market Review. This report features world capital market performance and a timeline of events for the past quarter. It begins with a global overview, then features the returns of stock and bond asset classes in the US and international markets. Updated quarterly and always available on our Home Page. Click HERE to … [Read more...] about Q3 Market Review Posted
Presidential Elections and the Stock Market
In knots over next month's election? You aren't alone. In a recent survey, fifty-two percent of American adults ~ Democrats and Republicans ~ admitted that the 2016 election is a "very or somewhat significant source of stress." Contributing to that stress is the steady stream of opinions from pundits and prognosticators about how the election will impact the stock market. Fortunately for your portfolio, opinions are not facts. Click HERE to de-stress with DFA's latest brief, "Presidential … [Read more...] about Presidential Elections and the Stock Market