Insights

Interest rates are rising. What does that mean to investors? Relax. If you hold short-duration, high-quality bonds, the news is generally good. First, a caveat: Predicting future interest rates is a treacherous business. The Federal Reserve lowered the federal funds rate to near zero in 2007-2008 in response to the Great Recession. Since 2009, “experts” have been predicting rising rates, but those predictions failed to materialize until the end of 2015 (six years later). The lesson: Nobody can predict the
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Embarking on a financial plan is like sailing around the world. The voyage won’t always go to plan, and there’ll be rough seas. But the odds of reaching your destination increase greatly if you are prepared, flexible, patient, and well-advised. A mistake many inexperienced sailors make is not having a plan at all. They embark without a clear sense of their destination. And once they do decide, they often find themselves lost at sea in the wrong boat with inadequate
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To pique the interest of investors, the financial media often features stories about the hidden dangers in the market—and index funds have been a recurring topic lately. According to some stories, the rising popularity of indexing has distorted prices because fewer shares are traded by investors who search for new information and act on it. Since the index fund was created in the 1970s, pundits have questioned whether too much passive investing would impede price discovery. Richard Posner, a leading
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See how $1 invested in the U.S. Total Stock Market grew over the last nine decades, as well as what was in the headlines in Time Magazine. As the video shows, short-term news events generally had little impact on long-term market growth.