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Larry Swedroe

Balanced & Lifestyle Funds

by Larry Swedroe
Monday, March 17, 2003

One thing the mutual fund industry does well is to create a product and then create demand for that product, even when the product may not be one that is in the investors' best ...Read More

Article Library

  • International Diversification in Retirement Accounts

    by Frank Armstrong — Friday, March 7, 2003

    International diversification is an issue that should have been settled a long time ago. However, many investors believe that cross-border diversification increases risk. Now, new support from academics provide new evidence of its value as a risk reducer. ...Read More

  • Domestic Indexes Fall Again in February

    by Staff — Monday, March 3, 2003

    The U.S. blue-chip Dow Jones Industrial Average fell 3.06% in February - the Dow is off 6.4% for the year. Measuring Europe, the Dow Jones STOXX 50 index was down 5.54% for February; year-to-date the index is down 12.2%. The Dow Jones Asian Titans 50 ...Read More

  • John Spence

    Interview with Paul Kaplan, Morningstar Director of Research

    by John Spence — Friday, February 28, 2003

    Chicago-based Morningstar, Inc. has ventured into a crowded index industry with the debut of 16 proprietary equity benchmarks that correspond to the firm's heralded style boxes. Morningstar's director of research, Paul Kaplan, sat down with us to discuss ...Read More

  • ETF Assets Decline in January

    by Staff — Thursday, February 27, 2003

    The combined assets of the nation's exchange-traded funds (ETFs) were $95.66 billion in January, according to the Investment Company Institute, falling from a December 2002 high of over $102 billion. ...Read More

  • Investors overpay Magellan by $330 million

    by Paul B. Farrell — Friday, February 21, 2003

    Magellan's rationale for charging $330 million more than Vanguard's S&P 500 fund every year is simple: They provide active-management to enhance performance and beat the S&P 500. Here's how Magellan's manager Robert Stansky described his ...Read More

  • How to Use the Data Section of

    by Staff — Thursday, February 20, 2003

    Since the performance data on this site was recently updated, we thought now might be a good time to post a primer on how to use the handy data tools and screeners on ...Read More

  • John Spence

    Interview with Barclays ETF Guru, Lee Kranefuss

    by John Spence — Tuesday, February 18, 2003

    Lee Kranefuss is the chief executive officer for Barclays Global Investors' Individual Investor and Exchange-Traded Products Business, where he is responsible for all of BGI's exchange-traded funds products as well as traditional mutual ...Read More

  • Vanguard in Favor of More Fund Holdings and Cost Disclosure

    by Staff — Wednesday, February 12, 2003

    The Vanguard Group said it supports the SEC proposal that could force mutual funds to disclosure more information about portfolio holdings and fund costs, according to a statement released today by the Valley Forge-based fund shop. ...Read More

  • Interview with Gene Fama Jr.

    by David Chaplin — Saturday, February 1, 2003

    Gene Fama Jr. is vice president of Dimensional Fund Advisors (DFA), the funds management firm founded on the academic principles of diversification first articulated by his father, Eugene Fama, in the 1960s. He explains to David Chaplin how the DFA ...Read More

  • Larry Swedroe

    It's Why They Call It The Equity "Risk" Premium

    by Larry Swedroe — Friday, January 31, 2003

    One of the most popular investment books of recent times was Dow 36,000: The New Strategy For Profiting From The Coming Rise In The Stock Market. The premise of the authors, James K. Glassman and Kevin A. Hassett, was that equity investing was not risky - ...Read More

  • John Spence

    Does Equity Indexing Have Hidden Risks?

    by John Spence — Wednesday, January 29, 2003

    Last week Standard & Poor's released its quarterly active vs. passive mutual fund scorecard with stark results: in most cases a majority of active funds have failed to beat their relevant index in the bear market of the past couple ...Read More

  • Dollar-Cost Averaging Small Amounts with ETFs

    by Staff — Wednesday, January 22, 2003

    Exchange-traded funds generally have lower expense ratios than comparable traditional index funds. However, since ETFs trade like stocks, investors must pay commissions every time they buy or sell ...Read More

  • Will McClatchy

    Financial Planning A La Carte

    by Will McClatchy — Thursday, January 16, 2003's second book, Index Funds - Strategies for Investment Success by Will McClatchy, recently hit the shelves. The book is designed as a guide for investors of all stripes who want to learn more about the benefits of index or passive ...Read More

  • John Spence

    Interview with John Bogle, Vanguard Group Founder

    by John Spence — Tuesday, January 7, 2003

    John Bogle heads the Bogle Financial Markets Research Center, a think-tank funded by Vanguard and located at the company headquarters in quiet Valley Forge, Pennsylvania. He is the founder of the Vanguard Group and author of several best-selling ...Read More

  • John Spence

    Barclays to Launch U.S. Fixed Income ETFs

    by John Spence — Saturday, January 4, 2003

    Barclays Global Investors (BGI) filed with the Securities and Exchange Commission (SEC) January 2 to launch five fixed income exchange-traded funds (ETFs) based on Lehman indexes: ...Read More

  • Jim Wiandt

    Standard & Poor's Executives Discuss Future of Indexes

    by Jim Wiandt — Friday, January 3, 2003

    Excerpts from roundtable discussion with Bob Shakotko, Senior Vice President, S&P Index Services and David Blitzer, S&P 500 Chief Strategist. The full version of the interview was originally published in the December issue of The Index Insider, a new ...Read More

  • How Much International???

    by Frank Armstrong — Wednesday, December 25, 2002

    Many investors avoid international exposure in the mistaken belief that they are avoiding unnecessary risk. In fact, by failing to diversify cross border they actually substantially increase their risk. Token positions do little benefit the portfolio. The ...Read More

  • Strategy vs. Outcome

    by Frank Armstrong — Thursday, December 12, 2002

    Investing is a noisy process. In the short term, it is extremely difficult to distinguish between cause and effect. In the longer term, even with the best planning, wide variations in results must be expected. Investors must make decisions in an ...Read More

  • John Spence

    Interview with Morningstar's Peter Di Teresa

    by John Spence — Tuesday, December 10, 2002

    Peter Di Teresa is a consultant at Chicago-based Morningstar, Inc. Before moving on to a new role within Morningstar, he wrote the "Ask the Professor" column that frequently addressed issues concerning index investing. ...Read More

  • More ETF Advantages - Diversification & Costs

    by J.D. Steinhilber — Thursday, December 5, 2002

    In a previous article we looked at the tax benefits of exchange-traded funds, as well as fund swap strategies to harvest portfolio losses. This time we continue on with more ETF ...Read More

  • ETF Tax Efficiency and Swapping Strategies

    by J.D. Steinhilber — Wednesday, November 20, 2002

    Exchange-traded funds are inherently more tax efficient than actively managed mutual funds, which have been rightly criticized for their tax-inefficiency. Tax-efficiency is a critical issue for advisors and investors because delaying the taxation of ...Read More

  • Total Domestic ETF Assets Over $100 Billion

    by Staff — Tuesday, November 19, 2002

    There are currently 281 exchange-traded funds listed around the world, with over $140 billion in assets under management, according to a new report by Boston-based indexing giant State Street Global Advisors. ...Read More

  • John Spence

    A Look At the New Bond ETF Families

    by John Spence — Friday, November 15, 2002

    After years of development and regulatory hurdles, fixed-income ETFs have finally hit the market. San Francisco-based Barclays Global Investors beat ETF Advisors to the punch with a family of iShares tied to Lehman Brothers bond indexes. New York-based ...Read More

  • First ADR Index ETFs Begin Trading on Nasdaq

    by Staff — Wednesday, November 13, 2002

    Four new exchange-traded funds tied to Bank of New York American Depository Receipt (ADR) indexes began trading on the Nasdaq Exchange today. Called BLDRS, the new members of the ETF family will have expense ratios of 0.30%. The Bank of New York will ...Read More

  • The Consulting Game

    by Frank Armstrong — Tuesday, November 12, 2002

    The one thing Wall Street tells you that you can always take to the bank is: "Past performance is no guarantee of future performance." Of course, they really hate telling you that, but they are required to. The rest of Wall Street's message is designed to ...Read More

  • John Spence

    Interview with Mutual Fund Gadfly, Roy Weitz, of

    by John Spence — Tuesday, November 5, 2002

    Roy Weitz, CPA is the founder of, an independent and noncommercial website that serves as an unofficial community watchdog for the mutual fund industry. Mr. Weitz writes a revealing and colorful monthly commentary on the industry that is ...Read More

  • Spitzer Roasts Stock Analysts at Awards Ceremony

    by Staff — Monday, November 4, 2002

    Imagine being invited to an award banquet only to find out later the main course is . . . you. That's exactly what happened to Wall Street analysts at the annual ceremony for Institutional Investor magazine's "All-Star Research Team" awards earlier this ...Read More

  • New ETF Advisers Fixed-Income ETFs Begin Trading

    by Staff — Friday, November 1, 2002

    Four new U.S. Treasury exchange-traded funds began trading today on the American Stock Exchange. The new funds, introduced by ETF Advisers, track Treasury securities with one, two, five and 10-year maturities. Called "fighters" - Fixed Income Trust ...Read More

  • John Spence

    How Advisors Harvest Tax Losses with ETFs - The Basics

    by John Spence — Thursday, October 31, 2002

    Financial advisors often use index fund tax-swap strategies as a way to maintain equity exposure while offsetting realized or unrealized gains in a portfolio, which is the closest thing to a free lunch in investing. Exchange-traded funds are becoming a ...Read More

  • Total ETF Assets Decline in September

    by Staff — Tuesday, October 29, 2002

    Total exchange-traded fund assets declined over $9 billion in September to about $82 billion, according to the Investment Company Institute. The ICI, the trade group for the mutual fund industry, keeps monthly tabs on ETF ...Read More

  • First ETFs Tracking Dow Jones Global Sector Indexes Introduced

    by Staff — Wednesday, October 23, 2002

    Dow Jones Indexes said Credit Suisse Asset Management has licensed some of its global Sector Titans indexes for ETFs to be launched later this week. The new ETFs will be tied to the Dow Jones Banks Titans 30, the Dow Jones Technology Titans 30, and the ...Read More

  • John Spence

    Interview with Ron Ross, Author of The Unbeatable Market

    by John Spence — Wednesday, October 23, 2002

    Ron Ross is the author of a new book entitled The Unbeatable Market: Taking the Indexing Path to Financial Peace of Mind. This one caught our attention because of its accessability, and also because the author refuses to pull punches when it comes to ...Read More

  • Two New European ETFs Begin Trading

    by Staff — Tuesday, October 22, 2002

    UBS Global Asset Management introduced two new exchange-traded funds: the Fresco Dow Jones STOXX 500 (FEU) and the Fresco Dow Jones Euro STOXX 50 (FEZ). The new ETFs, which track the European and Eurozone markets, began trading on the New York Stock ...Read More

  • John Spence

    Q&A with Khalid Ghayur, MSCI Index Development

    by John Spence — Friday, October 18, 2002

    Khalid Ghayur knows a thing or two about indexes. He is global director of research and chief investment strategist for index provider Morgan Stanley Capital International (MSCI). Mr. Ghayur, who answered our questions from his Princeton office, is ...Read More

  • John Spence

    Interview with Gus Sauter, Vanguard Index Fund Manager

    by John Spence — Wednesday, October 16, 2002

    As managing director of the quantitative equity group at Vanguard, Gus Sauter oversees the management of $200 billion in 24 index funds. He is also responsible for the management of $4 billion in Vanguard's actively-managed funds, and $1 billion in ...Read More

  • Editors' Model Portfolios

    by Staff — Wednesday, October 16, 2002

    Finding index funds that make up the building blocks of a diversified portfolio is important, but fitting them together is the real challenge. For our favorite index funds covering various asset classes, please see our editors' picks. ...Read More

  • Editors' Model Portfolios - Slice & Dice

    by Staff — Wednesday, October 16, 2002

    This portfolio is a very simple interpretation of slice and dice, with large caps coupled with small value. This portfolio deviates from the total stock market approach by overweighting small value stocks. ...Read More

  • Editors' Model Portfolios - Core & more

    by Staff — Wednesday, October 16, 2002

    This portfolio shouldn't be confused with the strategies that involve active funds. The idea of core and more is to lay down a core portfolio and explore by overweighting certain asset classes. Core and more portfolios can take on many shapes and sizes ...Read More

  • Editors' Index Fund Picks - Domestic Bond Funds

    by Staff — Tuesday, October 15, 2002

    Bond index funds can reduce risk in a portfolio. Indexing bonds also makes sense because of their lower yields compared to stocks. We like short-term bonds because of their low risk and lack of correlation with equity ...Read More