The Debate Over Retirement Income Strategies

As millions of baby boomers are either retiring or nearing retirement, there is an ongoing debate on how to manage one’s portfolio heading into and once in retirement. Here’s a glimpse into it: While at last week’s Morningstar Investment Conference, I tweeted a comment made by Morningstar’s David Blanchett about the likelihood of success for…

 

What is the Most Tax-Efficient Investment?

An AAII member recently asked, “What is the most tax-efficient investment?” Before you answer, stop and give the question some thought. The answer is not as straightforward as it may seem. A few factors influence the tax efficiency of investing. One, of course, is the type of investment. Municipal bonds receive very favorable tax treatment,…

 

How Impactful Are Changes in Analyst Ratings?

Before you give into any temptation to follow analysts’ recommendations, consider this conclusion from three researchers: “On average, analysts’ revisions are not highly correlated with subsequent long-run returns, indicating that analysts do not provide new information that is relevant for the long run for typical investors.” The finding is from an appropriately named paper published…

 

Two Traits that Give Active Mutual Funds an Edge

American Funds says that some actively managed funds are better than passive (index) funds. Specifically, the company argues that actively managed funds with low expense ratios and high levels of manager ownership (a group that Amercian Funds calls “Select Active”) outperform their index peers. The outperformance is evident over one-, three-, five-, and 10-year rolling…

 

FINRA’s Proposal to Halt Elder Fraud: Stop Withdrawals

The Financial Industry Regulatory Authority (FINRA) released a new proposal to protect seniors from financial fraud. The rules will allow financial companies to respond to situations in which there is a reasonable belief that financial fraud is occurring. If fully implemented, financial firms would be able to place a hold on the dispersal of funds…