Dec 20th, 2010 | Passive investing | 0 komentárov
John Stossel from Fox Business discussed with Burton Malkiel, professor of economics at the Princeton University, whether actively managed mutual funds are a sound investment. However, the fact is that over the last decade (during which we experienced two stock market crashes) passively managed funds has beaten more than 2/3 of actively managed funds. The reason behind this finding is the high cost of active management. Active investors are left with less money to work for them. The next reason is the random character of financial markets.
→ pokračovanie článku
Dec 14th, 2010 | Passive investing | 0 komentárov
If the financial markets are efficient then technical analysis is doomed to failure. If markets react almost instantly to new information that comes in randomly and which effect (either positive or negative) cannot be predicted the graph of a stock market should be very similar to a graph of random walk. A number of studies concluded namely that people cannot tell a real stock market graph from a random walk (here) .
→ pokračovanie článku
Dec 1st, 2010 | Passive investing | 0 komentárov
If we can predict economic variables such as GDP, unemployment, inflation, etc., it is probable that we could use it in investing and achieve thus abnormal returns. In fact, if we could predict the market movements, it would be a holy grail of investing. But what do the experts say about forecasting?
→ pokračovanie článku
Nov 23rd, 2010 | Passive investing | 0 komentárov
Burton Malkiel (who is Burton Malkiel) presents in his article for The Wall Street Journal several points for passive investing and index funds in the wake of the financial crisis when many financial advisors or money managers argue that this form of investing (also called as Buy&Hold) has gone.
Professor Malkiel presents a number of arguments that seemingly have to be repeated all over again – there is no one who could time the market for an extended period of time. And if there is someone who predicts the market gyrations in one year the odds are that next year it will be someone else as the markets are random. Moreover, if over let’s say 10 years you miss just a few of the most positive days in terms of returns your overall return for your portfolio will be dramatically less than with a Buy&Hold approach.
→ pokračovanie článku
Nov 18th, 2010 | Passive investing | 0 komentárov
In my articles I try to persuade the readers of my blog that investing is not a difficult undertaking at all. It is absolutely sufficient to follow a few simple rules – e.g. to invest in low cost passively managed index funds, to diversify broadly, to keep the costs as low as possible, to not trade or speculate, to hold the investments as long as possible. This is good news for all of us. We do not have to financially support the bankers, expensive investment advisors, or brokers.
→ pokračovanie článku
Nov 14th, 2010 | Passive investing | 0 komentárov
I recommend this outstanding article on data mining with links to other relevant sources. Data mining is not a bad thing a priori. However, in connection with investing one has to be very careful. This expression describes an attempt to find a time series that would explain the movements of the stock market at any cost. This model would thus be able to predict the stock market.
→ pokračovanie článku
Nov 5th, 2010 | Passive investing | 0 komentárov
Burton Malkiel is a professor of economics at the Princeton University and a former dean of the Yale School of Management. Both are prestigious US universities. But first of all, he has been a firm believer and supported passive investing since it beginnings. Have a look at his top 5 books on investing.
SK
EN
Loading ...
