2016

ETFs will underperform actively managed funds at some point; just stay the course and don’t ditch them.

You heard it here first: active funds will outperform passive funds, sometime, somewhere, in some market, over the next few months, or years. At which point, however briefly, we shall be inundated with I-told-you-so’s from all quarters – the truly most talented investors as well as the obviously most clueless salespersons and, of course, the press. And if you are not careful you will to be dragged into the fray and begin concocting all sorts of clever justifications to pay those 1.0%-1.5% TERs (which conservatively are more like 1.5%-3.0% when you include trading costs; see this paper) forever thereafter.

It’s the right season for both, but some gifts are better left unopened and returned to the sender.

It’s beautiful to be trusted by someone who’s never seen you before. In some cases, it’s almost better than receiving a gift.

Things are not easy, but neither are they as complicated as some may want you to believe.

I’m bound to repeat myself here, at least in part. This maybe a function of my incompetence in clarifying some concepts or perhaps of the (limited) number of readers of this blog.

How the mood of the times can influence decisions.

These days one has to be either deaf or very stupid to defend any “establishment” conventions on governing bodies. Well, I’m either deaf or stupid – or both.

Loosely translated from local dialect (expletives deleted).

Monday morning. Sunny day with slight northerly breeze. Trees in full autumnal colors. Recruitment session in a financial institution’s office, somewhere in southern Europe.

A loss is always a loss – whether “taken” or not.

In collaboration with Michael Tanney, Wanderlust Wealth Management, New York.

Not one day goes by without some news on some robo-advisor somewhere in the world. The phenomenon is interesting in itself, but what blows my mind is the speed with which these investment platforms are being adopted by RIAs (Registered Investment Advisor) to lower costs and increase flexibility for their clients.

Of what exactly I’m not sure; but fear (and lack of leadership) it most certainly is.

We know that monetary policy has a lasting and meaningful impact on the real economy when there is a need either to remove a constraint on the financial system (crisis of 2007-8) or to impose one (fighting inflation).

What’s patience worth? Possibly a lot.

If you lost your job would you

[a] look for another job and adjust your living style accordingly

or

[b] look for another job and try supplementing your lost income by betting at the race track?

Journalists and asset managers: similar objectives, similar methods.

Luca Sofri, publisher of ilpost.it, has written a wonderful book on sloppy and otherwise compromised journalistic practices in Italy and elsewhere (Notizie che non lo erano). In reading it I could not help to find similarities between journalism and investing.