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Berkshire Hathaway As An Asset Class?
Admit it, if you’re using some sort of asset allocation strategy this question has crossed your mind. I’m not talking about indirectly owning Berkshire through a fund*, but a direct concentrated...
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The Folly of Stock Market Forecasting
A slightly different post today–I had the opportunity to do some guest writing for Alpha Architect. I took the opportunity to explore the error associated with stock market forecasts using the Gordon...
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Deconstructing Peter Lynch
Actively managed mutual funds have earned their place among the most unloved of paper assets, and rightly so. The high fees combined with persistent under-performance are a serious drag on growing...
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Cost of Capital
Good businesses, by definition, earn more than they spend. Those that can’t or don’t simply cease to exist. A quick glance at any corporate balance sheet reveals a wide ranging list of liabilities...
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Getting Real With Inflation
Inflation is one of the oldest and most well known adversaries faced by investors. Simply put it measures the change in price of goods and services that we purchase or consume including food, fuel,...
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Quantitative Value
The idea of buying stocks that are cheap and holding on as they appreciate in value over time is well aligned with the simple heuristic “buy low and sell high.” This central concept has created, for...
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The Five Laws of Gold
The Richest Man In Babylon was originally a collection of parables penned by George Clason in 1926 that focused on the judicious handling of money. Ninety years later these stories are still very...
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Confessions Of An Asset Allocator
Several years ago when I made my first real attempts at managing my own assets the idea of a fixed asset allocation strategy made a lot of sense. Diversify by allocating broadly to a wide range of...
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The Sharpe Ratio As An Efficiency Metric
Ratios and normalized metrics are used regularly in the hard sciences, particularly when it comes to comparing scenarios and outcomes. The efficiency of a vehicle, for instance, is typically measured...
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Mastery or Ignorance Part III
This post was also featured at Fortune Financial Advisors Written by Lawrence Hamtil and Daniel Sotiroff with help from Alpha Architect’s Jack Vogel and Severian Asset’s Sam Lee In the first...
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What is the best “Risk-Off” Asset for Trend-Followers?
This post also appeared on AlphaArchitect.com So you’re a trend-follower. Great. But here is a question: What do you invest in when your rules suggest “risk off?” Many investors suggest low duration...
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Minsky’s Model of Mania
The word bubble, in the context of financial markets, gets thrown around a lot these days. Some of this is understandable considering the global economy was, and still is, recovering from the...
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The World is Flat (Sometimes)
Some of my favorite subjects in grade school were the accounts of famous global explorers such as Magellan and Columbus. The history of these pioneers usually has some attachment to the flat Earth...
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Bulls, Bears and Beta
I can’t take credit for the idea of this post, but I thought it was an interesting idea and worth some exploration. *** The original Capital Asset Pricing Model (CAPM) relates the expected return of an...
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The Most Important Thing
Investing consists of exactly one thing: dealing with the future. -Howard Marks Several years ago I was introduced to the writings of Howard Marks and have been a loyal follower ever since. The...
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Quantifying Risk: Volatility and Drawdown
Traditional financial theory has relied heavily on standard deviation or variance (the square of standard deviation) to quantify historic risk. Markowitz mean-variance optimization and the Sharpe ratio...
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An Update for My Readers
Greetings, I hope that 2017 is finding everyone happy and healthy My writing on these pages has admittedly slowed. This has not been for a shortage of ideas or time, but instead due to a change in the...
View ArticleMinsky’s Model of Mania
The word bubble, in the context of financial markets, gets thrown around a lot these days. Some of this is understandable considering the global economy was, and still is, recovering from the...
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