AAII Survey: Why Retail Investors Sell Mutual Funds

Mutual fund turnover typically measures the replacement of holdings in a mutual fund and is commonly presented to investors as a percentage over a one year period. If a fund has 100% turnover, the fund replaces all of its holdings over a 12-month period. However, you may discover that your mutual fund turnover rate is much higher than you expected. The typical managed…

 

AAII Survey: Retail Investors’ Taste for Fixed Income

In general, investing in debt instruments (bonds, bond funds, etc.) is safer than investing in stocks. That’s because debtholders have priority over shareholders–if a company goes bankrupt, debtholders (creditors) are ahead of shareholders in the line to be paid. In this worst-case scenario, the creditors usually get at least some of their money back, while shareholders often lose their…

 

AAII Survey: Investors React to Fed’s Decision to Slow Rate Increases

Since 2015, the Federal Reserve has increased interest rates nine times. While those investing in interest-bearing instruments have applauded these increases, others, including President Trump, have railed against the central bank increasing interest rates too quickly. Following the last meeting of the Federal Open Market Committee (FOMC), Fed chairman Jerome Powell signaled that the central bank…

 

AAII Survey: Causes of Financial Stress

According to the 2015 American Psychological Association’s (APA) annual Stress in America report, nearly 90% of Americans said that their financial stress level “has either remained the same or gotten worse” with time. A recent GOBankingRates survey found that many Americans tap into their emergency savings to cover home costs, medical emergencies and even cost-of-living increases. AAII Weekly…

 

Is Inflation Bad for the Stock Market?

The debate over whether stocks rise or fall in reaction to inflation continues. But studies indicate what many investors have suspected all along: The market is inconsistent. Editor’s Note: The “throwback” article was written in early 1986. The U.S. economy is experiencing the lowest inflation rates in almost two decades. The stock market is at…

 

Financial Planning: The Substance Beneath the Froth

What Is a Financial Plan? Financial planning itself is not new, or even very exciting. Well-run businesses have been practicing this common-sense activity since the dawn of the capitalist era. What is new is the application of sound financial management techniques to personal as well as business affairs. Systematic personal financial planning involves considering one’s…

 

AAII Survey: How Many Brokerage Accounts Do You Have and Why?

If you want to buy and sell individual stocks and other investments, you pretty much need to have at least one brokerage account. However, one question many investors ask is whether they need or should have more than one brokerage account. Diversification is an important investment concept—spreading your money across different investment types, styles, etc….

 

The Secrets of Picking Great Growth Stocks

Why is it that bright, educated people who come across stocks that could make them wealthy for life, so frequently fail to capitalize on golden opportunities—not enough brains or education? No, not even close. Two things are responsible: Beating ourselves, and a lack of knowledge. Beating ourselves is mainly emotions, meaning too much fear or…

 

AAII Survey: Premarital Financial Discussions

My housemate loves watching reality television, which means I get to watch a lot of reality programming. Her favorites include, and please don’t judge, The Bachelor, The Bachelorette and Married at First Sight. As a finance guy, some of the more interesting conversations that happen on these shows are usually the most awkward: the financial…

 

“Enhanced” Index Funds: Can They Beat the Market?

John “Jack” Bogle, founder and former chairman of the Vanguard Group and father of the index mutual fund, passed away this week at the age of 89. Here is an article he contributed to the AAII Journal in 2007, which has been edited to reflect new data. Since the inception of the first index mutual fund…