The Investment Scientist

Posts Tagged ‘Morningstar

Like Odysseus, automatic investments help investors avoid the Siren call of market timing

We call it stupid if someone takes a $55k job, even if he is offered the same job at $100k.

We call it market-timing when the same thing happens in the stock market. The long-term average annual market return is 10%, but the long-term average annual investor return is only about 5.5%. This is documented both by Dalbar’s study titled “Quantitative Analysis of Investor Behavior” and Morningstar’s research on fund returns and investor returns.

How could this possibly happen?

Read the rest of this entry »

My friend Carl Richards made an interesting observation in his last post:

Just when we need something to zig, they all zagged together!

FearSome people draw the conclusion that diversification no longer works. I strongly disagree.

Read the rest of this entry »


Author

Michael Zhuang is principal of MZ Capital, a fee-only independent advisory firm based in Washington, DC.

Twitter: @mzhuang

Error: Twitter did not respond. Please wait a few minutes and refresh this page.

Archives

%d bloggers like this: