Tag Archives | diversification

The Power of Diversification

In my last post we discussed the three key concepts that determine the price of an individual security.  Here we’ll explore the importance of diversifying your investments. More than five decades of academic research has confirmed two key benefits of diversifying and they’re among the most powerful concepts in financial economics: (a) Having a diversified portfolio […]

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Take the Guesswork Out of Investing

Why might a person’s portfolio return less than the market?  This is a common question among investors – let’s look at an example along with a potential explanation. Let’s take an investor’s portfolio that is made up of 60% stocks and 40% bonds. For this example let’s say the S&P 500 Index returned 9%, and is […]

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How Do I Handle the Ups and Downs in the Market?

Have you ever entered a contest or a raffle where the fine print reads: “Must be present to win”? Of course being there won’t guarantee you’ll take home the grand prize, but there’s one thing you know for sure: If you sit on your hands, safe at home, they will undoubtedly remain empty. The markets […]

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Why Should We Invest Internationally?

In a recent post, we introduced a helpful new Dimensional Fund Advisors video series that answers some of investors’ top-of-mind questions. The series features our own advice, as well as advice from other like-minded wealth managers across the country. At Independence Advisors, we are big on spreading both our creative and financial capital around the […]

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Managing Household Records

Spring cleaning and tax season go together like peanut butter and jelly. Every year we are faced with decisions about what to keep and what to throw away. How long do I need to keep my tax returns? Receipts? Brokerage trade confirmations? Having a system to find all of these records is just as important […]

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Expected Sources of Premium Stock Returns Part III: Capturing Return Premiums Requires Resolve

In our last post, we described how small-company and value stocks have served as a source for premium returns in the past. Today, we’ll explain how capturing these returns has rarely been as easy or obvious as 20/20 hindsight might lead us to believe. Figure 2 Consider Figure 2, from 1928–2014. It illustrates three critical […]

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How We Select Investments

When introducing evidence-based investing, we like to begin by explaining why we feel it’s the right strategy for those who are seeking to build or preserve their wealth in wild and woolly markets. Of course sensible strategy is best followed by practical implementation, so it’s also worth describing how we select the funds we typically […]

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