Tag: episode_1733

AVOID MARKET TIMING

February 12, 2021

AVOID MARKET TIMING

  • Historical evidence shows market timing leads to significantly lower returns than buy and hold strategy
  • Market timing also leads to increased volatility
  • “…the volatility of investor returns is higher than the corresponding volatility in nearly all specifications.”
  • “Specifications’’ considered: individual stocks, stock mutual funds and stock indexes in U.S. and major international markets
  • Increase in volatility with trading is significant: 10-75% higher.

Source: “The Volatility of Stock Investor Returns” Ilia D. Dichev, Emory University, Xin Zheng, University of British Columbia

Watch the related WEALTHTRACK episode.

PAGE: FINANCIAL DNA

February 12, 2021

FINANCIAL DNA

Nurture or nature? T. Rowe Price’s asset allocation thought leader, Sébastien Page reflects on the influence his Finance Professor father had on his career path.

Watch the related WEALTHTRACK episode.

PORTFOLIO DIVERSIFICATION’S FAILURE TO PROTECT IN BEAR MARKETS CALLS FOR A NEW STRATEGY

February 12, 2021

Part 1 of 2
Talk to most investment professionals and they will tell you that portfolio diversification is the key to successful investing and that asset allocation among multiple asset classes, not individual security selection, accounts for as much as 100% of investment returns. Being broadly diversified among different asset classes is supposed to give you strong exposure to market rallies and protection in down markets as non-correlated assets zig when others zag and soften the downside impact.
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Portfolio Diversification’s Failure: Bear Markets Calls for a New Strategy

February 12, 2021

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