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Pensions Unaware Hidden Real Estate Fees Dwarf Those Disclosed

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by Edward Siedle, Founder, BenchmarkAlert.com
Tuesday, June 21, 2016

In recent years, following a decade-long gorging on hedge and private equity funds by government pensions, the massive hidden fees and expenses related to these "alternative" investment funds have attracted greater scrutiny. Despite initial skepticism, it is now widely ...Read More

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  • Bond Funds or Individual Bonds? What You Need To Know

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    by Tom Allen and Mark Hebner — Friday, June 17, 2016

    A common question we receive from clients has to do with bond strategies. Should we buy bond funds or build individual bond ladders? There are a few things to keep in mind when thinking the role of fixed income from a portfolio standpoint. As an investment advisor, we think ...Read More

  • False Diversification

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    by Tom Allen and Mark Hebner — Wednesday, June 15, 2016

    As proponents of globally diversified portfolios, we understand the principle of diversification when it comes to investing. Harry Markowitz was one of the first academics to identify the benefits of adding additional assets to a portfolio. In theory, assets with different ...Read More

  • Tom Allen and Mark Hebner

    Vanguard's Active Funds: A Deeper Look at the Performance

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    by Tom Allen and Mark Hebner — Tuesday, June 7, 2016

    Vanguard is the largest fund management company in the world. Mostly known for being a pioneer in the development of index funds, they also carry quite a few actively managed funds in their lineup.                      ...Read More

  • Eugene Fama: One of A Kind

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    by Tom Allen and Mark Hebner — Monday, June 6, 2016

    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

  • Index Reconstitution: The Price of Tracking

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    by Dimensional Fund Advisors — Thursday, June 2, 2016

    With the annual reconstitution of the Russell indices approaching, it is a good opportunity to revisit how index reconstitution events affect trading costs and returns. Index funds are an innovative solution for investors that provide diversified investments at low fees. On any ...Read More

  • Tom Allen and Mark Hebner

    Invesco: A Deeper Look At the Performance

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    by Tom Allen and Mark Hebner — Wednesday, June 1, 2016

    Invesco Ltd. is one of the most well-known investment firms in the country. Their operations span over 20 different countries around the world and are involved in investment management, wealth management, banking, and alternative ...Read More

  • Tom and Becky

    Volatility... Is There More of it Today?

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    by Tom Allen and Becky Vasquez — Wednesday, May 25, 2016

    If you follow the stock market, you cannot get away from the word volatility.  It is discussed in the media, over the Internet, the front page of the newspaper’s Business section.  All you have to do is Google “today’s volatility” and you will ...Read More

  • Tom Allen and Mark Hebner

    T. Rowe Price: A Deeper Look at the Performance

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    by Tom Allen and Mark Hebner — Thursday, May 19, 2016

    T. Rowe Price has clearly stated their value proposition to their investors. But what exactly is that value and, more importantly, who is receiving the bulk of that value?                               ...Read More

  • Tom and Denise

    Reverse Mortgages: What You Need to Know

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    by Tom Allen and Denise Delaney — Tuesday, May 17, 2016

    There has been a sharp rise in the reverse mortgage market in last the decade within the United States. According to the National Reverse Mortgage Lenders Association (NRMLA), the annual number of reverse mortgage loans issued has grown from 157 in 1990 to over 58,000 in 2015. ...Read More

  • Family Limited Partnerships: What You Need To Know

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    by Tom Allen and Mark Hebner — Tuesday, May 10, 2016

    Wealth transfer strategies are an extremely important topic when it comes to financial planning. Establishing the proper legal conduits to ensure the maximum amount assets transferred to beneficiaries according to a client’s best wishes is one of the biggest value ...Read More

  • The Matrix Book: A DFA Tradition [VIDEO]

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    by Mark Hebner and IFA Contributors — Friday, May 6, 2016

    "Data! Data! Data!" he cried impatiently, "I cannot make bricks without clay!" — The Adventures of Sherlock Holmes, The Adventure of the Copper Beeches - Sir Arthur Conan Doyle, ...Read More

  • The Small-Cap "Alpha" Myth: An Update!

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    by Tom Allen and Mark Hebner — Wednesday, April 27, 2016

    There is a common misconception about “alpha” in the small-cap market within the United States. Many professionals believe that once we step out of the mega-cap world of companies like Google, Wal-Mart, Coca-Cola, and Apple where there is an army of analysts digging ...Read More

  • Fortune's Most Admired Companies in 2001 Versus Index Funds

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    by Tom Allen and Mark Hebner — Monday, April 25, 2016

    We analyzed Fortune's "Ten Most Admired Companies" (2001)1 as a whole portfolio and as individual companies, comparing them to 10 index portfolios for the 15-year period from January 2001 through December 2015. The results of the study are shown in the chart below, indicating ...Read More

  • A Look Back at Eugene Fama's 2013 Nobel Prize in Economics

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    by Mark Hebner and IFA Contributors — Sunday, April 24, 2016

    As we approach the three year anniversary of Professor Eugene Fama winning the Nobel Prize in Economic Sciences, we thought it worthwhile to call attention to this article by his colleague at the University of Chicago Booth School of Business and son-in-law, Professor John H. ...Read More

  • Tom Allen and Mark Hebner

    Pursuing a Better Investment Experience with Index Fund Advisors

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    by Tom Allen and Mark Hebner — Friday, April 22, 2016

    The wide world of investing is complex. For most of us, it’s a vague concept that is seemingly associated with uber-wealthy like Warren Buffett. We all understand the concept of having our money grow for future financial goals like retirement, but connecting the dots from ...Read More

  • The 1st Quarter of 2016 in Review [VIDEO]

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    by Tom Allen and Mark Hebner — Tuesday, April 19, 2016

    The first quarter of this year was a textbook case on the importance of having discipline when approaching the investment process. January was a punishing month for markets around the world as fears of China’s economic slowdown precipitated across all major asset classes. ...Read More

  • Tom Allen and Mark Hebner

    The Not So Midas Touch - A Deeper Look at the Performance

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    by Tom Allen and Mark Hebner — Monday, April 18, 2016

    King Midas of Pessinus was a well-known character in Greek mythology that was known for turning whatever he touched into gold, known as the Midas Touch. Some companies have embraced the story of King Midas and his touch within their own ...Read More

  • Tom Allen and Mark Hebner

    Oppenheimer Funds: A Deeper Look At Their Performance

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    by Tom Allen and Mark Hebner — Tuesday, April 12, 2016

    Oppenheimer Funds is a subsidiary of Oppenheimer Holdings & Co., one of the largest financial institutions in the entire world. Having roots dated over a century ago, the Oppenheimer name has acted as a beacon of financial expertise. Their services include investment baking, ...Read More

  • Fort Lauderdale Joins the Evidence-Based Investing World

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    by Tom Allen and Brendan Connelly — Monday, April 11, 2016

    Being a part of the passive investment community can be very isolating at times. It is a constant uphill battle against an industry that is built largely on an illusion. Most of the headlines and stories by active managers that we read in any online or print publications are ...Read More

  • Free Throws

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    by David Butler — Wednesday, April 6, 2016

    Dave Butler offers a sports example to help investors apply discipline in a stressful market   “What do you regard as the most difficult period in the financial markets during your 25 years in the investment business?” I am often asked this question, usually by ...Read More

  • Tom Allen and Mark Hebner

    Wells Fargo: A Deeper Look at the Performance

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    by Tom Allen and Mark Hebner — Thursday, March 31, 2016

    Wells Fargo is one of the largest institutions in the world. In fact, it is considered a Systematically Important Financial Institution (SIFI), in which its failure could potentially lead to a much larger financial crisis, similar to what we experienced in 2008 and ...Read More

  • Warren Buffett, Market Efficiency and the Disappearance of Alpha

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    by Tom Allen and Mark Hebner — Wednesday, March 30, 2016

    As staunch admirers of Warren Buffett, we at IFA can only marvel at the value he has created for his investors over the course of his illustrious career. Anyone fortunate enough to own Berkshire Hathaway since June 1st, 1979 has seen a remarkable 711-fold increase in wealth as ...Read More

  • Failure of Active Management is Not Just a U.S. Phenomenon

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    by Tom Allen and Mark Hebner — Thursday, March 24, 2016

    It is common to believe, unfortunately, that there are certain areas of the public equities market that may ripe for active managers to display their skill. The belief is that certain corners such as the small cap market in the United States or the Emerging Markets in general ...Read More

  • How To Read Your Form 1099 Composite

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    by Tom Allen and Mark Hebner — Friday, March 18, 2016

    As we approach tax day (April 18th, 2016), we wanted to take the time to go over the 1099 Forms that have been provided to our clients by Fidelity, Schwab, and TD Ameritrade. If you haven’t received this document, you can download them online at your custodian’s ...Read More

  • The $1 Million Dollar Bet: Buffett Winning Big

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    by Tom Allen and Mark Hebner — Wednesday, March 16, 2016

    Warren Buffett is considered a household name amongst the investment community. The famed investor and third richest man on planet earth is well-known for his investing acumen. Although he has had long-term success in beating the overall stock market, he is also well known for ...Read More

  • DoubleLine Equities Growth Fund: Another One Bites the Dust

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    by Tom Allen and Mark Hebner — Monday, March 14, 2016

    We have written extensively about the “stock pickers graveyard,” which is the final resting place for those funds that ended up on the wrong side of Lady Luck. Jeffrey Gundlach, former fund manager and founder of DoubleLine Capital, recently announced that they were ...Read More

  • Diversification: Expanding the Opportunity Set!

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    by Tom Allen and Mark Hebner — Monday, March 7, 2016

    “Diversification is your buddy!” – Merton Miller, Nobel Laureate Diversification means different things to different people. Some people understand the timeless adage of “don’t put all of your eggs in one basket,” which strongly emphasizes the ...Read More

  • The Leap Year Approach to Investing

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    by Tom Allen and Mark Hebner — Thursday, March 3, 2016

    2016 marks another special year for those who happened to have a significant event, like a birthday or wedding anniversary, fall on February 29th. The Leap Year, which is that extra day that we get every 4 years to help align our calendar year with an actual solar year ...Read More

  • Quantifying the Value of Tax Loss Harvesting: An Update

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    by Tom Allen and Mark Hebner — Monday, February 29, 2016

    In August of 2014 we released a study that attempted to quantify the value of providing tax loss harvesting services using a data sample from our own clients’ experiences. As we mentioned in the original study, there has been dispute among investment professionals on ...Read More

  • Booth, Fama and French: Perspectives on Market Volatility

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    by Dimensional Fund Advisors — Friday, February 26, 2016

    Volatile markets can be stressful for investors. But volatility also can be viewed in a more positive light. Price changes show that markets are working as they quickly incorporate new information into stock prices. A sound investment philosophy can guide behavior during ...Read More

  • Volatility is a Good Thing!

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    by Tom Allen and Mark Hebner — Tuesday, February 23, 2016

    Many readers may call us crazy, but hear us out. The beginning of 2016 has been tumultuous to say the least. Concerns over China’s transition from an export based economy to a more developed economy based on its own aggregate demand as ...Read More

  • Oil Prices and Equity Returns

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    by Tom Allen and Mark Hebner — Friday, February 19, 2016

    No doubt one of the biggest stories over the last 18 months has been oil. Currently, oil prices (as measured by the WTI Crude Index) are at levels we haven’t seen for almost 13 years. While many see falling oil prices acting as a tailwind for the overall economy, ...Read More

  • Good Advice

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    by Mark Hebner — Wednesday, February 17, 2016

    In today’s climate of one-page financial plans, bargain-basement fund pricing and automated investment tools, you may wonder whether you still need a living, breathing financial adviser. You do. But with a twist. First, we need to redefine traditional financial advice ...Read More

  • Low Future Economic Growth and Expected Returns

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    by Tom Allen and Mark Hebner — Tuesday, February 16, 2016

    We have recently come across a series of articles that are giving warning about the near future of slowed economic growth, high levels of volatility, and potentially lower returns from stocks and bonds. Although the stories are compelling, we believe that investors should be ...Read More

  • Tom and Becky

    Social Security Changes: Is the "File and Suspend" Strategy For Me

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    by Tom Pohlen and Becky Vasquez — Friday, February 12, 2016

    Understanding the ever-changing landscape of our government’s Social Security system has grown more complex over time.  Whether it is a question as simple (on the surface at least) as when to file for Social Security, or something much more complex as to trying to ...Read More

  • Are You Saving Too Little or Too Much for Retirement?

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    by Tom Allen and Mark Hebner — Wednesday, February 10, 2016

    How do we enjoy our resources today without sacrificing future financial security? What is the delicate tradeoff between current and future consumption? These questions are extremely important. At one extreme we find the vast majority of Americans who spend almost all of their ...Read More

  • Replacing Speculation With An Education: Investors Embrace Index Funds

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    by Tom Allen and Mark Hebner — Wednesday, February 3, 2016

    The war has been long. Much longer than the World Wars of the 20th century, the Vietnam War, the Civil War, and even the war on terrorism. This war started in the early 1960s, when statisticians began digging into stock price data to find trends. To their bewilderment, there ...Read More

  • Shifting the Conversation: Benchmarks for Managing Income Uncertainty

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    by Tom Allen and Mark Hebner — Monday, February 1, 2016

    In order to find the right solution, you must ask the right question. Within retirement planning, particularly within the realm of target date funds, we may have been asking the wrong question for some time now. Many investors are well aware of traditional target date fund ...Read More

  • The Retirement Plan Puzzle: Advisor is the Key Piece

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    by Tom Allen and Mark Hebner — Friday, January 29, 2016

    The retirement plan industry has come out of the shadows in the last three decades. For the better half of the last century, the topic of retirement plans could have rivaled watching the grass grow in terms of entertainment and intellectual curiosity. Why? Most citizens whose ...Read More

  • Tom Allen and Mark Hebner

    USAA Mutual Funds: A Deeper Look at Their Performance

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    by Tom Allen and Mark Hebner — Friday, January 22, 2016

    The United Services Automobile Association (USAA) started during the roaring 20’s. Their story began with US Army officers who were refused insurance due to the risky nature of their careers (only 4 years removed from World War I). These men saw a ...Read More

  • What Jack Bogle Does With a 10% Market Drop: Absolutely Nothing!

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    by Tom Allen and Mark Hebner — Friday, January 22, 2016

    In a recent interview with CNBC, founder of Vanguard, Jack Bogle, tells investors do just “stand still,” amid the recent 10% drop in US markets. Highlights include maintaining the same savings behavior for retirement plan participants, the superiority of index ...Read More

  • A Vanishing Value Premium?

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    by Weston Wellington — Friday, January 22, 2016

    Value stocks underperformed growth stocks by a material margin in the US last year. However, the magnitude and duration of the recent negative value premium are not unprecedented. This column reviews a previous period when challenging performance caused many to question the ...Read More

  • The 4th Quarter of 2015 in Review [VIDEO]

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    by Tom Allen and Mark Hebner — Wednesday, January 20, 2016

    The best way we can describe the 4th Quarter, overall, is a great end to somewhat of an abysmal year. Stocks delivered positive results in the United States, International/Developed, and Emerging Markets. Global Real Estate and Foreign Bonds also posted positive results, while ...Read More

  • Alternative Investments in Target-Date Funds: Poisoning the Well

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    by Tom Allen and Mark Hebner — Tuesday, January 19, 2016

    A recent report was released by ThinkAdvisor cited the recent increase in alternative investments making their way into defined contribution plans. According to Cerulli Associates, a research firm based out of Boston, “alternatives have long been used in defined benefit ...Read More

  • 2016: Ten Predictions to Count On

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    by Jim Parker — Wednesday, January 13, 2016

    The New Year is a customary time to speculate. In a digital age, when past forecasts are available online, market and media professionals find it harder to hide their blushes when their financial predictions go awry. But there are ways around that. The ignominy that goes with ...Read More

  • What Not To Put On Your New Year's Resolution List: Investment Strategy

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    by Tom Allen and Mark Hebner — Tuesday, January 12, 2016

    As we start the beginning of the year as we all customarily do, evaluating some of the things we neglected in the previous year, such as health and wellness, certain relationships, etc., and decide to reverse those trends this year, the one thing that should not be on the ...Read More

  • The Market Playing Peek-a-Boo

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    by Mark Hebner — Thursday, January 7, 2016

    Have you ever noticed how a newborn’s favorite game is peek-a-boo? Now you see it. Now you don’t. In 2015, global markets seemed particularly intent on playing peek-a-boo with ...Read More

  • The Market Knows Best: Federal Reserve Raises Rates

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    by Tom Allen and Mark Hebner — Tuesday, January 5, 2016

    Well there you have it folks. The Federal Reserve finally took action to increase the Federal Funds Rate. The catastrophe that was anticipated by many financial pundits ended up being what seemed like no news at all. How could this possibly be? While many market participants ...Read More

  • 5 Actions You Should Take Going Into 2016

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    by Tom Allen and Mark Hebner — Tuesday, December 29, 2015

    As we button up the end of another year here at IFA, we wanted to remind clients of some of the things they should be thinking about when it comes to their finances going into ...Read More