This week’s AAII Weekly Digest highlights these “must-read” AAII articles:
Given the recent bumps in the stock market, we revisit an article written in late 2008, during the last market meltdown to give you some perspective. Financial turmoil can prompt an emotional response that causes investors to flee stock holdings. But this can cause long-term harm to your portfolio. Instead, you need to put things in perspective and stick to the fundamental rules of investing.
Asset location is a tax-minimization strategy of placing investments in accounts that ultimately will produce the highest aftertax return for the investor’s entire portfolio. Strategically taking into consideration both tax laws and the tax-efficiency of an investment will maximize aftertax returns.
A former hedge fund manager discusses how the strategies he used managing client money also applies to managing his family’s money. Following a top-down approach to asset selection, he uses anticipated relative value among stocks, bonds and cash to determine his asset allocation. This oftentimes puts him at odds with the “hot” asset class of the moment.
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.
Our Member Question for this week is:
Citing that, “the case for raising rates has weakened somewhat,” Federal Reserve chairman Jerome Powell signaled that the central bank will slow the pace of interest rate increases. Do you think this is good or bad for investors?
Vote to answer this week’s Special Question: Why do you think the case for raising short-term interest rates has weakened and what does this mean for investors and the economy in the longer term?
Last Week’s Results:
Poll results are as of 9 a.m. (Central) on Monday. 1,959 respondents.
Data shows that most Americans experience some type of financial stress. To see if this applies to our readers, we asked what the primary causes of financial stress are for them as well as how they go about alleviating that stress.
“Easier said than done” is a common saying that applies well to developing an overall strategy for your investment portfolio. The basic concepts are relatively easy, but they become more complex and less clear-cut when it comes to applying them to real-world situations. This e-book, available exclusively to AAII members, is designed to bridge the gap between theory and practice.