Ever ridden in a car with worn-out shock absorbers? Every bump is jarring, every corner stomach-churning, and every red light an excuse to assume the brace position. Owning an undiversified portfolio can trigger similar reactions. Explore how spreading your portfolio across different securities, sectors, and countries can smooth the bumpy and unpredictable ride that lies between you and your long-term investment goals, with Dimensional Funds VP Jim Parker in the attached article "Investment … [Read more...] about Investment Shock Absorbers
The Reality of Models
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