Investments

Decorative pattern

Market Insights

The economics of retirement

Extreme market volatility and declining portfolio values — trends that are most on the minds of financial advisors and their clients this year — point to the conclusion that 2008 has been a bad year for retirement economics. If volatility and portfolio values were the only criteria consider, this conclusion would be a slam dunk […]

By Peter Drake |January 2, 2009

4 min read

Decorative pattern

Market Insights

Discount season

As grim as equity markets appear to be, Ian Lapey maintains that buying opportunities abound. “We are getting unbelievable bargains – great companies with extremely strong balance sheets that we are buying at 50 cents on the dollar,” says Lapey, 42, a portfolio manager at New York-based Third Avenue Management LLC, who oversees the $320.9-million […]

By Michael Ryval |January 1, 2009

3 min read

Decorative pattern

Market Insights

The analysts shop

Visitors to Morningstar’s website can easily see which funds our analysts like the most in our Fund Analyst Picks section. But it’s enlightening for readers to see that we put our money where our mouths are. First, I’ll share what I’m planning to buy this year, and then we’ll survey what a few of my […]

By Brian O'Neill |January 1, 2009

5 min read

Decorative pattern

Market Insights

The next bargain

First, a confession: we’re not really growth stock investors. That’s not to say we avoid stocks with strong earnings growth. It’s just that growth is not the only attribute we look for in a company. We prefer to buy quality companies run by good managers at valuations that make sense. If they happen to pay […]

By Rob Edel |January 1, 2009

5 min read

Decorative pattern

Market Insights

Crystal gazing

Predicting what 2009 might bring, after last year’s stock-market snafu, would be akin to committing hara kiri. But, as they say, history repeats. And advisors can survive this year by taking cues about investment and insurance cycles from precedents set in the dotcom downturn that ended in October 2002. When the IT bubble burst, the […]

By Al Emid |January 1, 2009

4 min read

Decorative pattern

Market Insights

Waiting for the end

In the run-up to the U.S. elections, investors might have been forgiven for thinking the worst of the bear market was behind them. The S&P 500 had bounced off of its low of about 840, set on October 27, to above 1,000 by November 4, 2008 – Election Day. The choice of Illinois Senator Barack […]

By Staff |December 22, 2008

5 min read

Decorative pattern

Market Insights

Market busters

When markets tank – even though a correction, or even a bear market, was long overdue – investors usually have difficulty staying the course. That’s not news for fi- nancial advisors. Risk tolerance morphs into loss aversion as the enduring fact of market cycles is learned one more time. Are market cycles avoidable? There’s no […]

By Scot Blythe |December 22, 2008

8 min read

Decorative pattern

Beta loaded

Despite being caught with their hands in the beta cookie jar last quarter, hedge funds had one of the best relative performances ever in Q3 – beating equity indices by a country mile. Most industry participants acknowledge that various alternative beta and even, as we have recently seen, traditional betas have found their way into […]

By Chris Holt |December 22, 2008

3 min read

Decorative pattern

Market Insights

Rewarding risk

Portfolio and fund managers have short time horizons when investing. Their compensation promotes asset gathering and short-term performance. That means managers are paid for hot annual numbers, trade more frequently than is sometimes prudent, and subject clients to unnecessary costs. Managers will deny it, but they all try to “time markets,” a notoriously difficult and […]

By Ioulia Tretiakova |December 22, 2008

5 min read

Decorative pattern

Big frauds and small starts

Big frauds often start small. Unforgivably, they often start with small omissions. Let’s take Bernard Madoff Investment Securities, whose managed accounts are now out $50 billion. It’s not clear whether that $50 billion was lost or if it was the supposed profits on $17 billion clients’ investments. It is clear that the numbers are big; […]

By Scot Blythe |December 18, 2008

3 min read

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