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- Call: 888-643-3133 |
- 12-Steps:
- Step 1
Step 1: Active Investors
Definitions
Problems
- 1.3.1 Active Investors are Everywhere
- 1.3.2 Active Investors are Gamblers
- 1.3.3 Active Investors Lose
- 1.3.4 The Poor Accounting of Active Investors
- 1.3.5 Stock Market Prices are Random
- 1.3.6 Stock Markets are Efficient
- 1.3.7 When Risk Capacity is not Matched with Risk Exposure
- 1.3.8 The High Cost of Turnover
- 1.3.9 The Emotional Stress of Active Investing
- 1.3.10 More than 1,500 Investors can be Wrong
- Step 2
Step 2: Nobel Laureates
Definitions
Solutions
- Alfred Nobel
- Blaise Pascal
- Edmund Halley
- Adam Smith
- Louis Bachelier
- Alfred Cowles
- Harry Markowitz
- James Tobin
- Frank Modigliani
- Merton Miller
- William Sharpe
- Paul Samuelson
- Eugene Fama
- Michael Jensen
- Rex Sinquefield
- Friedrich von Hayek
- Burton Malkiel
- John Bogle
- David Booth
- Kenneth French
- Who Do You Trust?
- Market Forces: May They Be With You
- Step 3
Step 3: Stock Pickers
Definitions
Problems
- 3.3.1 Why Stock Pickers Fail
- 3.3.2 The Stock Picker’s Graveyard
- 3.3.3 Incubator Funds
- 3.3.4 Studies and Observations that Show the Daunting Odds of Stock Picking
- 3.3.5 Stock Pickers and Coin Flippers
- 3.3.6 Stock Pickers are Focused on Short Term
- 3.3.7 Stock Pickers are Style Drifters
- 3.3.8 Stock Pickers are Looking for a Needle in a Haystack
- 3.3.9 Stock Pickers Play a Zero Sum Game
- 3.3.10 Stock Pickers in International Markets
- 3.3.11 Stock Pickers in Small-Cap Markets
- 3.3.12 Stock Pickers Pay More Taxes
- 3.3.13 Stock Picking Gurus and Their Real Records
- 3.3.14 Stock Pickers Don’t Want You to Know the Truth
- Step 4
Step 4: Time Pickers
Problems
- Step 5
Step 5: Manager Pickers
Problems
- Step 6
- Step 7
Step 7: Silent Partners
- Step 8
Step 8: Riskese
Definitions
- 8.2.1 Standard Deviation
- 8.2.2 Probability Distributions and Histograms
- 8.2.3 Mean Reversion
- 8.2.4 Expected Return
- 8.2.5 Rolling Period Returns
- 8.2.6 Risk
- 8.2.7 The Dimensions of Stock Return
- Market Risk Factor
- Size Risk Factor
- Value Risk Factor
- Term Risk Factor
- Default Risk Factor
- 8.2.8 Implications of the Fama/French Three-Factor Model
- 8.2.9 Time Diversification of Risk
Problems
- Step 9
Step 9: History
- Step 10
Step 10: Risk Capacity
Definitions
Problems
- Step 11
Step 11: Risk Exposure
Definitions
Problems
Solutions
- 11.4.2 Index Mutual Funds Earn more Return and Eliminate more Risk
- 11.4.3 The Most Efficient Funds on the Market
- Small Cap Strategy
- U.S. Small-Cap Strategy
- U.S. Micro-Cap Strategy
- Value Strategies
- U.S. Small-Cap Value Strategy
- U.S. Large-Cap Value Strategy
- Real Estate Securities Strategy
- U.S. Large Company Strategy
- Developed International Markets
- Emerging Markets
- Fixed Income
- 11.4.4 Are Commodities Worth the Risk?
- 11.4.5 Matching People with Portfolios
- Step 12
Step 12: Invest and Relax
Definitions
- 12.2.1 Registered Investment Advisers
- 12.2.2 Dimensional Fund Advisors
- 12.2.3 Rebalancing Portfolios
- 12.2.4 Rebalancing Formula
- 12.2.5 Tax Loss Harvesting
- 12.2.5a Mutual Fund Distributions
- 12.2.5b Cash Withdrawal Considerations
- 12.2.6 Financial Advice
- Estate Planning
- Insurance
- Accounting and Tax Advice
- Investment Advisors
- Life Planning
- The Glide Path of Life and Your IFA Index Portfolio
- Retirement Planner
Problems
- 12.3.1 Active Investors Procrastinate
- 12.3.2 Active Investors "Go It Alone"
- 12.3.3 The Media Wants Investors to Worry
- Asset Allocation
- Minimization of Investment Costs
- Minimization of Taxes
- Reliable Investment Performance
- A Simple and Understandable Investment Strategy
- An Easier Way to Track Investment Performance
- Increased Leverage and Compounding
of Investment Wealth - Invest like Institutional Investors
About Us
Suite 150 Irvine, CA 92612 Toll Free: 1-888-643-3133 Local Phone: 949-502-0050 Fax: 949-502-0048 Our corporate office is located on the ground floor of the Atrium Building in Irvine, CA, which is close to Orange County's John Wayne airport. View Directions online, Print Version of Directions or contact us at any of our regional locations. Midwest Regional Office 2918 Marketplace Drive, Suite 111 Madison, WI 53719-5328 Toll Free: 1-877-373-9934 Northeast Regional Representative Toll Free: 1-888-342-7026 Texas Regional Representative Toll Free: 1-888-643-3133
Articles About Us: Personal Finance (Canada) 1 2 USA Today 5/20/05 USA Today 5/17/05 USA Today 3/29/04 Web Site Accolades CBS MarketWatch.com IFA on Motley Fool.com Orange County Register USAToday MarketWatch: Freakoindex Fool: Investor, Heal Thyself Nat. Post: The Art of Indexing |
Index Funds Advisors, Inc.(IFA) is a fee-only Independent Financial Advisor (ifa), registered with the United States Securities and Exchange Commission. IFA incorporated on March 5, 1999. Under U.S. law, investment advisors owe their clients an ongoing fiduciary duty to provide full and complete disclosure of all fees, conflicts of interest, and to exercise discretion in selecting investments with only their clients' best interests in mind. All investors should make sure they have an independent financial team to reduce conflicts of interest among the team. They should include an independent Registered Investment Advisors (like IFA), an independent Estate Planning Attorney, an independent CPA, and an independent Insurance Advisor. Call IFA to discuss how to assemble this team, if you don't already have one.Index Funds Advisors provides wealth management by utilizing risk-appropriate, returns-optimized, globally diversified and tax-managed portfolios of index funds. IFA founder, Mark Hebner and the team at IFA have done extensive research as shown on this web site and the highly ranked book titled Index Funds. This research leads our clients to an optimal money management strategy, net of our advisory fees and taxes. IFA completely avoids the futile, speculative, and unnecessary cost-generating activities of stock, time, manager, and style picking. Instead, our investment strategy employs a disciplined, quantitative approach, emphasizing broad diversification and consistent exposure to the structural trends of publicly traded markets around the world. The IFA advice is based on the highly respected research indexes designed by Eugene Fama and Kenneth French and documented in their empirical and peer-reviewed publications. The two professors rank high on total downloads per paper on the Social Sciences Research Network. Our current and independent advice incorporates 85 years of IFA Indexes and IFA Index Portfolio risk and return data, third generation index fund designs and 30 years of refined passive trading techniques employed by Dimensional Fund Advisors (DFA.) IFA does not accept payments from DFA or from any other recommended investments. IFA has a fiduciary duty to our clients and is exclusively paid by those clients for ongoing advice about the optimal wealth management of their assets. We can assist clients in establishing and evaluating relationships with estate planning attorneys, independent insurance advisors, and accountants. IFA plays several roles in the process of providing investment advice. They may be summarized with these seven roles:
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Corporate Headquarters, Irvine CA IFA adds value through matching people with portfolios by carefully qualifying and quantifying 5 dimensions of an investor's Risk Capacity and matching it to 5 dimensions of a portfolio's Risk Exposure. IFA obtains academically identified capital market rates of returns for its clients from about 13,000 public companies in the U.S. and about 43 other countries around the world. IFA then designs highly tax-managed and low cost trading strategies, maintains ongoing proper risk exposures through rebalancing, offers a glide path option, offers tax loss harvesting, manages cash inflows and outflows, and provides monthly and inception to date detailed measurements of client performance relative to the IFA Indexes and other traditional benchmarks. By encouraging very smart behavior among our clients, we position them to be more successful at capturing the returns of the funds. As you see below the average fund investor and the do-it-yourself indexer have not been very successful at capturing the returns the market has to offer. The chart below summarizes several studies on the percentage of returns captured by various types of investors. The IFA Investment Principles:1. Capitalism works on average and over time. This statement might be explained by Hebner's estimate that more than 100,000 public companies over 85 years have earned an average annual profit about 9%/year. If companies or stockholders of those companies desired capital, they traded their stock certificates for cash from investors. Through this trade, stockholders gave up the stock's future return of about 9% per year. That return has been driven up over the last 85 years by the average profits of those simulated and actual S&P 500 companies. This is known as the firm's cost of capital and the firm's cost of capital is paid to the investors. 2. Risk and return have a positive correlation. 3. Free markets match prices to current levels of uncertainty, so that buyers can expect to earn a risk-appropriate return. 4. The greater the risk, the longer the time required to obtain the expected return. Investors should capture the average return of all stocks and the average return of a sufficient number of months. 5. Passively invest, diversify to the maximum, maintain a small and value tilt and keep turnover, costs and taxes to a minimum. 6. Risk exposure must be initially matched to the investor's risk capacity, then monitored and maintained through rebalancing. 7. Avoid capital gains and dividends and realize losses in taxable accounts through tax loss harvesting. IFA manages individual and institutional accounts, including IRA, 401(k), 403b, profit sharing, pensions, endowments and all other investment accounts. We also facilitate IRA rollovers from 401ks and 403bs. IFA provides investment advice to individuals, trusts, corporations, non-profits, and public and private institutions. Also see our socially responsible investment advice for Catholics. See our SEC public disclosures HERE. The chart below shows IFA's growth of assets under management since inception in 1999. IFA Clients:
IFA assists clients in creating and purchasing diversified portfolios of index funds, primarily from Dimensional Fund Advisors (see The DFA Brochure -- also see Transparency in Mutual Funds), Vanguard, Fidelity and BlackRock (iShares). Dimensional Fund Advisors strives to deliver the performance of capital markets and add value through portfolio design and trading.
DFA departs from the rules and rigidity of traditional index funds
and avoids the cost-generating activity of stock picking and market timing.
Instead DFA focuses on the dimensions of capital markets that reward
investors and they deliver them as intelligently and effectively as possible.
Their indexes tend to overweight small cap and value stocks, where expected
returns are greater. Over 1,000 Investment Advisors rated DFA as
the best overall company in the mutual fund business in several
surveys. We primarily advise clients to invest in their funds to create globally diversified
portfolios of index funds. DFA funds are only available
to individual investors through DFA approved investment
advisors. IFA is approved for the purchase of DFA funds, but receives no
compensation from DFA or any other investments. |
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The IFA Team
Retirement Plan Services
Advisor Assistants
|
- 12-Steps:
- Step 1
Step 1: Active Investors
Definitions
Problems
- 1.3.1 Active Investors are Everywhere
- 1.3.2 Active Investors are Gamblers
- 1.3.3 Active Investors Lose
- 1.3.4 The Poor Accounting of Active Investors
- 1.3.5 Stock Market Prices are Random
- 1.3.6 Stock Markets are Efficient
- 1.3.7 When Risk Capacity is not Matched with Risk Exposure
- 1.3.8 The High Cost of Turnover
- 1.3.9 The Emotional Stress of Active Investing
- 1.3.10 More than 1,500 Investors can be Wrong
- Step 2
Step 2: Nobel Laureates
Definitions
Solutions
- Alfred Nobel
- Blaise Pascal
- Edmund Halley
- Adam Smith
- Louis Bachelier
- Alfred Cowles
- Harry Markowitz
- James Tobin
- Frank Modigliani
- Merton Miller
- William Sharpe
- Paul Samuelson
- Eugene Fama
- Michael Jensen
- Rex Sinquefield
- Friedrich von Hayek
- Burton Malkiel
- John Bogle
- David Booth
- Kenneth French
- Who Do You Trust?
- Market Forces: May They Be With You
- Step 3
Step 3: Stock Pickers
Definitions
Problems
- 3.3.1 Why Stock Pickers Fail
- 3.3.2 The Stock Picker’s Graveyard
- 3.3.3 Incubator Funds
- 3.3.4 Studies and Observations that Show the Daunting Odds of Stock Picking
- 3.3.5 Stock Pickers and Coin Flippers
- 3.3.6 Stock Pickers are Focused on Short Term
- 3.3.7 Stock Pickers are Style Drifters
- 3.3.8 Stock Pickers are Looking for a Needle in a Haystack
- 3.3.9 Stock Pickers Play a Zero Sum Game
- 3.3.10 Stock Pickers in International Markets
- 3.3.11 Stock Pickers in Small-Cap Markets
- 3.3.12 Stock Pickers Pay More Taxes
- 3.3.13 Stock Picking Gurus and Their Real Records
- 3.3.14 Stock Pickers Don’t Want You to Know the Truth
- Step 4
Step 4: Time Pickers
Problems
- Step 5
Step 5: Manager Pickers
Problems
- Step 6
- Step 7
Step 7: Silent Partners
- Step 8
Step 8: Riskese
Definitions
- 8.2.1 Standard Deviation
- 8.2.2 Probability Distributions and Histograms
- 8.2.3 Mean Reversion
- 8.2.4 Expected Return
- 8.2.5 Rolling Period Returns
- 8.2.6 Risk
- 8.2.7 The Dimensions of Stock Return
- Market Risk Factor
- Size Risk Factor
- Value Risk Factor
- Term Risk Factor
- Default Risk Factor
- 8.2.8 Implications of the Fama/French Three-Factor Model
- 8.2.9 Time Diversification of Risk
Problems
- Step 9
Step 9: History
- Step 10
Step 10: Risk Capacity
Definitions
Problems
- Step 11
Step 11: Risk Exposure
Definitions
Problems
Solutions
- 11.4.2 Index Mutual Funds Earn more Return and Eliminate more Risk
- 11.4.3 The Most Efficient Funds on the Market
- Small Cap Strategy
- U.S. Small-Cap Strategy
- U.S. Micro-Cap Strategy
- Value Strategies
- U.S. Small-Cap Value Strategy
- U.S. Large-Cap Value Strategy
- Real Estate Securities Strategy
- U.S. Large Company Strategy
- Developed International Markets
- Emerging Markets
- Fixed Income
- 11.4.4 Are Commodities Worth the Risk?
- 11.4.5 Matching People with Portfolios
- Step 12
Step 12: Invest and Relax
Definitions
- 12.2.1 Registered Investment Advisers
- 12.2.2 Dimensional Fund Advisors
- 12.2.3 Rebalancing Portfolios
- 12.2.4 Rebalancing Formula
- 12.2.5 Tax Loss Harvesting
- 12.2.5a Mutual Fund Distributions
- 12.2.5b Cash Withdrawal Considerations
- 12.2.6 Financial Advice
- Estate Planning
- Insurance
- Accounting and Tax Advice
- Investment Advisors
- Life Planning
- The Glide Path of Life and Your IFA Index Portfolio
- Retirement Planner
Problems
- 12.3.1 Active Investors Procrastinate
- 12.3.2 Active Investors "Go It Alone"
- 12.3.3 The Media Wants Investors to Worry
- Asset Allocation
- Minimization of Investment Costs
- Minimization of Taxes
- Reliable Investment Performance
- A Simple and Understandable Investment Strategy
- An Easier Way to Track Investment Performance
- Increased Leverage and Compounding
of Investment Wealth - Invest like Institutional Investors
Backtested Performance Info | Terms of Use | IMPORTANT DISCLOSURES
Index Funds Advisors, Inc. — 19200 Von Karman
Ave., Suite 150 — Irvine, CA 92612
Call Toll Free: 888-643-3133 — Local Phone: 949-502-0050 — Fax: 949-502-0048 — Email: 
For several other offices and representative locations, see About Us.