Investing

Whether you're a beginner or a pro, investing is a lifelong process in learning. Here you'll find a range of investing topics for all experience levels along with recommended investing books for additional learning and helpful investment tools to simplify your process.

In between you'll find actionable tips like picking an online broker, finding a financial advisor, or choosing the right fund for your portfolio.

Template For the Next Market Crash

Stock Market CrashCrashes happen. That’s a risk we take when investing. Lets face it, most of us are better off not following the daily stock market news. Tuning out is one way to leave your investments alone. Until a crash happens, then it’s hard to ignore.

Some event triggers it all. The media showcases the emotion of the day. It starts with frustration, then worry, moves to fear, until panic sets in. It’s a process that sometimes takes weeks or months.

Headlines spread the scary news. A parade of experts all have THE answer for what will happen next. Each one is different and extreme. All of them are wrong. But it doesn’t matter, they’re “experts”.

Articles rehash the events for weeks, and months, along with every anniversary there after. We give these days colorful names like Black Monday and Black Tuesday. Continue Reading…

Best Time To Own The S&P 500

S&P 500 Returns BreakdownWould it surprise you that the S&P 500 historical returns tell an eerily similar story to the history of international stock returns. Despite it, people still see the market as a casino or they complicate it with some overly elaborate strategy.

The S&P is the standard benchmark for large cap performance. It’s also an index you can own via ETF or index fund. While the experts argue whether now is a great time to buy the S&P, history tells you a better story.

The S&P 500 has been around in some form since 1926. That gives us 88 years of annual returns to dig through. Since large cap stocks make up a big part of most allocations, this should give you an idea of what to expect from that piece of your portfolio.
Continue Reading…

The Argument For International Stocks

International Stocks Annual Returns BreakdownInternational stocks are a great way to diversify away from the U.S. But when a home country bias is alive and well, it’s easy to ignore everything else. U.S. stocks have performed admirably in the past, but international stocks have too.

Since 1970, the S&P 500 performed at a 10.40% annual clip (with dividends). Did you know that during that same time, international stocks practically matched it?

You can try to hand-pick countries based on expected returns or go with a basket of countries that captures all that missed opportunity. The tables below show how international stock returns breakdown. Hopefully, it makes the argument to stop ignoring the big opportunity outside the U.S. Continue Reading…

Look Beyond Dividends To Shareholder Yield

Shareholder YieldDividends are the easiest way to return money to shareholders. This draw a big enough following that there’s a label for it – dividend investing. For investors who proudly wear that label, I’d argue you should look for companies with a different type of yield appropriately called shareholder yield.

For me, a dividend is a nice addition to a great investment not a prerequisite. If you’re searching for great companies, there’s a good chance you’ll find one that pays a dividend now or down the road, because good companies deal with the same question eventually.

What To Do With All That Cash?

Just like people, some companies are better at managing money than others. Those that do it best use the five tools below to efficiently increase shareholder value: Continue Reading…

Index Fund Vs ETF: Does It Matter?

Index Fund vs ETF BattleGiven the choice between two funds – an index fund vs ETF – that meet the same goal, costs are a big deciding factor. The same principle works for the active vs index argument too. Why pay more for something when you get the same results for less somewhere else.

I think we can agree low costs matter. Once you decide on an all index portfolio, the next step is picking between similar index funds and ETFs. Both do the same thing, for the most part. So is one better than the other? Are there other factors to consider?

Index Fund vs ETFs Cost Debate

There are a number of ways to build a portfolio. For this exercise let’s use a sampling of asset classes to build two portfolios around – one with index funds and the other with ETFs. Continue Reading…