Investments

Stock prices rallied sharply around the world in the third quarter, with forty-two out of forty-five countries tracked by MSCI showing positive returns in US dollar terms. Total return exceeded 10% in nineteen different markets, while Ireland, Japan, and Morocco registered minor losses. For the twelve-month period ending September 30, 2012, forty markets had positive returns, with six countries—including the […]

The investment climate has been almost manic over the last year, with wild swings in global markets due to economic news and the financial crisis in Europe. At times like these some in the investment world argue that passive investors who sit on a diversified portfolio will get whipsawed. Instead, the argument goes, they should hand their money to an expert […]

Gold has soared in popularity in recent years as a hedge against inflation and weak currencies. Unfortunately for the gold bugs, a new study shows it is neither. In fact, the only time period for which gold has served as an adequate inflation hedge was the last 2,000 years. Any holding of less than that did not hedge inflation, say investment […]

Question: Which of the following statements applies to last week’s stock market behavior? Computer errors at a major trading firm generated millions of faulty trades, causing dramatic and puzzling price swings in dozens of stocks Wednesday morning. A New York Times columnist fumed that “Wall Street has created its own Frankenstein. The machines are now in charge.” Stocks on the fifty-two-week new […]

Some investors today are doing what worried investors always seem to do in times of stress—trying to avoid “risk” by buying the “safest” assets. In this case that has meant buying government bonds from the United States, Germany, Australia, the Netherlands, and other countries considered safe havens. Panic buying has pushed yields in some cases to negative levels, meaning investors […]

Spoiler alert: You are about to hear what effects this year’s Presidential election may have on the U.S. stock market six months down the road. Are you ready? The answer is probably not much. That’s right: a hotly contested election pitting competing economic policies against each other in a time of world  financial crisis probably will make little difference to […]

Gold has been on a tear since 2000, but its long-term record of growth for individual investors is pretty poor. From the end of 1999 through 2011, gold beat most major equity asset classes, gaining an average of 12.3 percent per year, says Dimensional Fund Advisors, a large California-based investment firm. But the record since 1975, when individual U.S. investors […]

Volatilestock markets generate a peculiar type of celebrity known as the “perma-bear.” This is the highly negative forecaster who gets credited with calling a bear market before it starts. What you usually don’t get told is that he or she has been calling for a bear market for years without success. When their big chance finally comes, perma-bears milk it […]

A recent article appearing in the Financial Times caught our eye—or perhaps we should say ear. At first glance it was unremarkable—just one among dozens of recent think pieces suggesting that investors were losing interest in stocks as markets around the world continued to stagnate. But the tone of the article sounded remarkably familiar. We dug out our copy of the “Death […]