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…

 

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…

 

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…