In September, the Federal Reserve (Fed) voted to leave the federal funds rate unchanged. Numerous factors affected this decision, but perhaps the most important factor considered was the tenuous global economic situation.  Raising U.S. rates at this critical juncture would have the effect of exacerbating currency and rate differentials across many countries. Higher rates just […]

Traditionally, there have been two methods of equity investing – active and passive. More recently, however, a third option has come into play. Claiming that the market is inefficient and that passive indexing can be improved upon, institutional investors set out to create a product that seeks to exploit market inefficiencies by overweighting certain equity […]

Over the last two decades, hedge fund investing has been heralded as a way to avoid stock market volatility.  Any investment strategy that delivers on such promises cannot be ignored!  Now the task is to find such an investment.  It will not be easy, since the number of hedge funds has soared in recent years.  […]

No one saw it coming! In hindsight, a simple review of the supply/demand equation clearly foreshadowed a crisis in the making. The quiet advance of the U.S. as a top global producer of oil surprised the markets as well as economists (Chart 1). Oil is a commodity and, by very nature, cyclical. The theory that […]

In topsy-turvy markets, it is easy to lose sight of our long-term goals. Volatility can cause our actions to be driven by fear or greed if we allow ourselves to get caught up in the noise. Market dislocation often provides a chance to reallocate assets into securities that have more promising total return potential. This […]

Forecasting and Confirmation Bias As human beings, we cannot help but approach our investing with behavioral biases. Over the next few quarters, we will explore these biases in depth so that we can be careful to counteract them should they begin to affect our portfolios.  This is a personal topic as well, since your investment […]