Where Investors Screw Up

It doesn’t matter how experienced you are with investing. We make lots of mistakes. Always have and always will. Investing is probably one of those disciplines where you literally have to “pay” your dues to make progress. It is an extremely humbling activity. It’s closest comparable in my mind is golf.

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Investment Activity Review - November 2014

After the brief “correction” in October, the market basically pulled a Men In Black where it essentially looked at the pen and proceeded to forget the past and resumed its ascendency to record highs. I made a couple of moves on my portfolios to bank some profits and to open some new positions. This is despite my feelings that the stock market is still overpriced.

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Stop Trying To Beat The Market!

This emphasis on beating the market has become entrenched especially within the financial services industry. For people managing other people’s money in products like mutual funds, pension funds and other types of managed portfolios, your investment pedigree and more importantly, your performance bonus is defined not only by if you have earned returns in excess of the market returns but also by how much, or the “alpha”. This pressure to beat the market has now trickled down to the masses. Investment products of many stripes are being cranked out with a marketing premise that their fund will outperform the market. This is insane and it has to stop.

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