Articles (143)

1,017,309 views

Featured Article


murray@ifa.com

UBS, Morgan Stanley, Merrill Lynch Earn Regulators' Wrath

231
by Murray Coleman
Tuesday, December 10, 2019

In the past, we've chronicled cases of misdeeds by brokers working with investors not only in the U.S., but also around the world. A development that made headlines recently involved a particularly well-known name in global banking and financial services: UBS.  ...Read More

Article Library

  • murray@ifa.com

    Savings Contribution Limits Go Up

    1,328
    by Murray Coleman — Updated: Monday, December 9, 2019

    Contribution limits for 2020 for various retirement accounts are rising. Here's a breakdown of how much you can now save in a tax-friendly ...Read More

  • Mark Hebner

    Dimensional Fund Advisors: A Deeper Look At The Performance

    56,494
    by Mark Hebner and Murray Coleman — Updated: Wednesday, December 4, 2019

    As many of our readers know, we don’t think too highly of the active mutual fund industry. Not because we have a personal vendetta against them, but because their pursuit of attempting to outperform the market using other investors’ money has only enriched themselves ...Read More

  • murray@ifa.com

    The Investment Premium: Another Factor of Expected Returns

    501
    by Murray Coleman — Tuesday, December 3, 2019

    A select group of market factors are known to drive stock and bond returns. Some offer less advantages to fund investors, such as momentum, which can prove difficult to capture without running up trading and other transactional costs.  Research by professors Eugene Fama and ...Read More

  • Mark Hebner

    Advisor Risk - How Would You Rate Your Advisor's Risk?

    17,044
    by Mark Hebner — Updated: Friday, November 1, 2019

    When it comes to investing, we can identify many risks investors assume, either knowingly or not. At Index Fund Advisors, we see it as our core mission to get investors to take the risks that are worth taking (e.g. market, size, value, term and default) and avoid the ones that ...Read More

  • murray@ifa.com

    2019 Q3 Market Review [VIDEO]

    1,214
    by Murray Coleman — Monday, October 14, 2019

    The third quarter produced a script worthy of the best tear-jerking romantic novel. The world's two biggest economies couldn't resolve an ongoing trade tiff, angst about Brexit and the European Union continued and sliding manufacturing data in the U.S. helped to raise fears of a ...Read More

  • Mark Hebner and IFA Contributors

    The Never-Ending Pursuit of Manager Alpha – Updated

    13,934
    by Mark Hebner and Murray Coleman — Updated: Tuesday, August 20, 2019

    As we have pointed out on many occasions, both stock picking and hiring an active manager to pick stocks on your behalf are mug’s games. While some investors diligently study individual stocks and other investors handsomely pay active managers to deliver alpha (an ...Read More

  • Mark Hebner

    Rebalancing Portfolios

    16,162
    by Mark Hebner and Murray Coleman — Updated: Tuesday, August 20, 2019

    It is important for investors to rebalance their portfolio to achieve risk control and maintain long-term investing ...Read More

  • Mark Hebner

    Asset Location

    21,002
    by Mark Hebner — Updated: Thursday, August 15, 2019

    An additional way that a passive advisor can add value is not just asset allocation but asset location. Specifically, for a client that has a mixture of taxable accounts, traditional IRAs, and Roth IRAs, it is often helpful to construct a single portfolio consisting of multiple ...Read More

  • Mark Hebner and IFA Contributors

    Advisor Alpha: The View from Vanguard

    10,682
    by Mark Hebner and Murray Coleman — Updated: Thursday, August 15, 2019

    At Index Fund Advisors, we have repeatedly cautioned investors to avoid getting ensnared in the never-ending pursuit of alpha by either picking stocks or hiring an active manager to pick stocks on their behalf. Nevertheless, by engaging in a few prudent practices such as ...Read More

  • murray@ifa.com

    2019 Q2 Market Review

    1,113
    by Murray Coleman — Thursday, July 25, 2019

    After logging strong returns in the opening three months of 2019, global equity markets slowed in the second ...Read More

  • Mark Hebner and Murray Coleman

    Selecting Investments Part 1

    57,098
    by Mark Hebner and Murray Coleman — Updated: Wednesday, July 24, 2019

    As a fiduciary for its clients, IFA only receives compensation from its clients and is therefore unbiased in its choice of ...Read More

  • Ian Liew

    SBBI: The Almanac of Returns Data

    15,320
    by Ian Liew and IFA Contributors — Updated: Friday, July 19, 2019

    Stocks, Bonds, Bills, and Inflation (SBBI) is often characterized as the Almanac of returns data. This magisterial work originally produced by Roger Ibbotson and Rex Sinquefield is considered the go to place when information is needed on the expected returns and risks of a ...Read More

  • Mark Hebner

    Cash Withdrawal Considerations

    17,248
    by Mark Hebner — Updated: Thursday, July 18, 2019

    IFA is often in the position of accommodating regular cash withdrawal by its clients. The question is how to best generate cash for ...Read More

  • mike

    Tax Mistakes Reported by Politicians

    572
    by Murray Coleman — Tuesday, July 16, 2019

    The warnings about potential dangers of trying to file your own tax forms are well-documented. Indeed, we've explored at IFA Taxes many of the biggest blunders taxpayers have made in the past working on even the most basic of IRS accounting ...Read More

  • Brad Steiman

    Paradox of Skill

    15,846
    by Brad Steiman — Updated: Tuesday, July 9, 2019

    Manager selection is a process that requires analyzing noisy performance data, so it should lean heavily on the notion of statistical ...Read More

  • Mark Hebner and Murray Coleman

    Dimensions of Expected Return: Patience is a Virtue – 2019 Update

    4,926
    by Mark Hebner and Murray Coleman — Updated: Monday, July 8, 2019

    Giving investment advice should always aim to meet investors at their level of understanding. We do not expect everyone to have a PhD in Economics, so it is important to focus on big ideas that are the most crucial to understand. This can include ideas such as diversification, ...Read More

  • Mark Hebner and IFA Contributors

    The Funded Ratio: An Actuarial Approach to Retirement Spending

    19,640
    by Mark Hebner and IFA Contributors — Updated: Wednesday, June 26, 2019

    In a recent Financial Professional Outlook, Russell Investments surveyed 234 financial advisors across 145 investment firms nationwide. According to their results, 60% of advisors said that more than half of their clients are near or in ...Read More

  • Eugene Fama: One of A Kind

    16,666
    by Mark Hebner and Murray Coleman — Updated: Wednesday, June 26, 2019

    Academics are a hallmark of the investment strategy that we recommend to our clients. While there are plenty of sales pitches professing some sort of new or “hot” idea on how to get rich quick, we rely on peer-reviewed academic research to guide the decisions that we ...Read More

  • Rex Sinquefield

    Active vs Passive Management

    26,282
    by Murray Coleman — Updated: Tuesday, June 25, 2019

    Active management is the art of stock picking and market timing. Passive management refers to a buy-and-hold approach to money management. It can be applied to any asset class: big stocks, small stocks, value or growth, foreign or domestic can all be accessed by passive ...Read More

  • Mark Hebner and IFA Contributors

    The Gambler's Fallacy and the Misuse of the Law of Large Numbers

    20,382
    by Mark Hebner and Murray Coleman — Updated: Monday, June 3, 2019

    If you have ever spent any time in a casino, it is likely that you have seen supposedly random events that appeared to be non-random. Perhaps the roulette wheel came up red seven times in a row, for example. If your reaction was to place a large bet on ...Read More

  • Mark Hebner

    Calculations for t-Statistics

    53,430
    by Mark Hebner — Updated: Wednesday, May 22, 2019

    In calculating the t-stat, the first step is to determine the excess returns the manager earned above an appropriate ...Read More

  • Mark Hebner and IFA Contributors

    Profitability and a Four-Factor Model

    23,941
    by Mark Hebner and IFA Contributors — Updated: Tuesday, May 21, 2019

    When constructing or evaluating a domestic equity portfolio, Index Fund Advisors has traditionally utilized the three-factor asset pricing model that Professors Eugene Fama and Ken French introduced1 in 1993. This model states that the expected return of a broadly diversified ...Read More