With the very public release of Michael Lewis’s new book, Flash Boys, much debate has been spurred about high frequency trading (HFT). As is often the case with issues that affect our bank accounts, it is easy to find pundits weighing in from both sides. With all of the debate, the cost is pretty minor, especially in a lower trading volume strategy that is inherent to a passive approach to the market. Even Michael Lewis warned against overreacting when discussing avoiding HFT by avoiding the ... [Continue Reading]
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We know two things for certain when it comes to the stock market. The first is that, eventually, the market will go down. The second is that when there seems to be a new pundit on the scene each week, claiming the market will go down, one of them will eventually be right. As you read the sky-is-falling headlines that plague financial news and consider what this means for your portfolio, keep in mind that you would be better off consulting the wisdom of a penny and not reading these articles at ... [Continue Reading]
Last week, in the first Janet Yellen-led FOMC meeting, we got clarity in what we should expect from Ben Bernanke’s successor. At least as of the first meeting, it appears that we will not experience any significant changes of direction. In Yellen Defends Fed’s Decision to Forgo Unemployment Threshold, Simone Pathe of PBS summarizes Yellen’s justification for changing the required conditions to raise the federal funds rate, perhaps the most significant outcome from the meeting. ... [Continue Reading]
As the tax deadline looms less than a month away, it is a good time to revisit something that we take into consideration all year to make our clients’ tax bills slightly less burdensome. In The Beauty of Asset Location, Sue Stevens of Morningstar tackles the first layer of consideration: bonds versus stocks. ... [Continue Reading]
As long as there exists a willing buyer who makes decisions based on fear, new and flashy investment “opportunities” will continue to pop up, promising a quick fix to whatever the current market condition is or to allay any fears of what might be. When their short shelf-lives inevitably expire, another new “opportunity” arises and the cycle begins anew. The alternative: a cost-effective and diversified portfolio that will weather any market cycle and is structured with you and your goals in ... [Continue Reading]