How to Keep Headlines From Driving Your Portfolio Decisions

On behalf of everyone at AAII, I want to say thank you to all of you who have served or are currently serving in the military. The stock market will be open Friday, Veterans Day, but banks and government offices will be closed. Big, unexpected events commonly trigger strong emotional reactions. The wiring in our…

 

Too Much Confidence Is Bad for Your Portfolio

Higher levels of confidence about one’s ability to invest lead to worse returns. I realize that this may seem counterintuitive to some of you, but this is the conclusion of a study accepted by the Journal of Behavioral and Experimental Finance (an earlier version of the study is available on SSRN). It’s yet another example of…

 

The Incredibly Shrinking Fed Growth Forecasts

Seemingly overlooked in all of the hubbub about a possible rate hike occurring at the December Federal Open Market Committee (FOMC) meeting is the longer-term trend of falling growth forecasts. FOMC members have collectively reduced their real (“inflation-adjusted”) long-run GDP growth forecasts for at least five consecutive years. The current long-run forecast calls for 1.80%…

 

Do You Need Growth for Successful Stock Picking?

A new stock screen I created omits one characteristic that may surprise some (or perhaps many) of you: growth. Nothing in the screen requires a passing company to be growing revenues or profits. It is an admitted deviation from how I’ve previously looked for stocks. I’m not alone in omitting growth. The four AAII Stock…

 

Planning for the Financial Impact of Alzheimer’s and Dementia

Though the impact of Alzheimer’s disease on families and friends from a lifestyle and emotional standpoint has been well-documented, little research has been done into the financial impact of caring for some afflicted by the disease. To determine the impact, the Alzheimer’s Association conducted a nationwide survey. The results are discussed in the association’s 2016…