It’s that time of year when everyone starts preparing for the New Year and Wall Street makes its 2016 predictions. I’ll get right to the point here – these annual predictions [ … ]
Category: Investment Strategy
The Temporal Problem in Market Forecasting
You can’t talk about money and investing without talking about time. After all, the two are inherently interconnected. There’s the time value of money, the erosion of value due to [ … ]
What If Everyone Indexed?
I see this question more and more as indexing grows in popularity. People generally think that more indexing will make the markets function less efficiently . I don’t think this [ … ]
“Price is a Liar”
This is a very good lecture by John Burbank of Passport Capital. I particularly like his explanation of prices: “Price is all the information that exists in the market…it’s just [ … ]
Three Things I Think I Think – Stupid Markets Edition
Here are some things I Think I am thinking about: 1. The fact that markets are hard to “beat” does not make them smart. I noticed this comment on a [ … ]
Smart Beta, Dumb Money and EMH
Someone asked me about Smart Beta in the forum the other day and I got to thinking about this. Indexers are all basically chasing some form of beta. But some [ … ]
What is Countercyclical Indexing?
We founded the concept of Countercyclical Indexing by answering some simple questions: Is a “balanced index” like a 60/40 stock/bond portfolio actually balanced? Does it make sense to rebalance back [ … ]
Problems with the Short-Term
Earlier this year I spoke about the problem of “the long-term”. This is the tendency for modern finance to emphasize a long-term view due to the fact that assets tend [ … ]
Out of Sample or Out of This World?
Cliff Asness has some strong words for anyone who wants to say that Factor Investing doesn’t work. Basically, shut up, you’re wrong. In a post earlier this week he went [ … ]