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John Bogle (JB): Let’s start off with the obvious. Imagine a circle representing 100% of the U.S. stock market, with each stock in there by its market weight. Then take out 30% of that circle. Those stocks are owned by people who index directly through index funds. The remaining...

Companies with excess cash can pay out dividends as well as repurchase outstanding shares that have been issued to the public. When a company reduces the number of outstanding shares, remaining shares gain a slightly larger proportional claim to the company and its profits. This...

The Internal Revenue Service (IRS) says aggressive, threatening actions from scam artists have been occurring nationwide during the early weeks of the 2015 tax season. These calls top the agency’s “Dirty Dozen” list of scams. The top tax scams includes: Phone Scams: Criminals...

If you’re retired—or nearing it—ensuring that your retirement investment portfolio lasts your lifetime is critical. And that’s not easy because by nature the stock market is volatile. What if a market downturn takes a bite out of your investment portfolio? While you cannot...

The returns realized by mutual fund shareholders in 2014 depended significantly on the categories they chose and, at least on the domestic equity front, whether they went with an active or a passive fund. We bring this up because a significant part of a fund’s returns are influenced...

Last month’s Asset Allocation Survey special question asked AAII members what, if any, allocation changes they expect to make this year. Slightly fewer than three out of 10 (30%) said they don’t anticipate making any changes. About 16% intend to increase their allocations to...

Setting up a covered call portfolio using securities that generated significant dividend distributions was covered by Ben Branch, professor of finance at the University of Massachusetts, Amherst, in two wonderful articles published in the AAII Journal last year. The articles ran...

What is the minimum dollar amount needed to start investing? It is a question some members ask us and likely one that many others have, especially those who are new to investing. Technically, you are only limited by the minimum amount required by a brokerage firm or mutual fund...

Deferred annuities are now to be held by target date funds within qualified defined-contribution plans, such as 401(k) plans. The inclusion of annuities allows target date funds to provide lifetime income to employers holding such funds. Target date funds alter their allocations...

Investing is about earning a financial return. Valuation is at the heart of investing—you need to find a stock selling at an attractive price relative to its intrinsic or underlying value, otherwise your prospects for a financial return are poor. Wait, you say, that sounds like...