Are active managers getting better and better at their jobs? Yes. Does that mean that it’s getting harder and harder for active managers to beat their own benchmarks? Also yes. In fact, money managers are getting better, researchers have found. They are better informed, better equipped and often better traders than a few decades ago.… Continue reading →

A rising tide lifts all boats, or so they say. That’s the inherent promise of indexing for retirement. But an important corollary should be mentioned: A leaky boat sinks in any tide. Investment fund expenses will kill your retirement plan, no matter what kind of market is ahead. That’s the takeaway from the latest study of… Continue reading →

What do Charles Schwab, Warren Buffett, Jim Cramer and John Bogle have in common? Shoe size, maybe? No, they all think that most Americans, up to 98% of us, should be using index funds to build a retirement nest egg. Schwab appears to be the most recent convert to the passive approach, telling reporters that… Continue reading →

If given a choice, would you prefer to retire with 79% more money than the typical investor? Easy question, right? Many retirement savers are given exactly this choice, yet only a third end up enjoying the extra cash. What’s the difference? Prudent, high-quality advice that helped them avo​id the roller coaster of emot​ionally driven decisions. Aon Hewitt, the… Continue reading →

In defense circles, it’s known as “fighting the last war.” A country shaped by a protracted conventional conflict can be unprepared for guerrilla attacks. A nation used to commanding the high seas is unlikely to muster an effective standing army. Fighting the last war with your investments is a major tactical blunder. Sticking to a… Continue reading →

Did you know that if you start early and save diligently, you could easily finance the retirement of a total stranger? That’s right. A total stranger. If you pay the big fees charged by mutual funds and high-priced active money managers, those costs can total up to more than $400,000 over your working life, according… Continue reading →

David Einhorn, the hedge fund guru best known for shorting Lehman Brothers in 2007, is back at it, this time with tech stocks in his sights. “There is a clear consensus that we are witnessing our second tech bubble in 15 years,” Einhorn’s $10.3 billion firm, Greenlight Capital, told clients in a letter this week.… Continue reading →

Ordinary retirement investors earn a return that pales in comparison to the stock market itself — more than 45% off the benchmark. Why is that, and can you do anything about it? We’re talking about trillions of hard-earned dollars, money that should be growing on behalf of millions of Americans and just isn’t. The results… Continue reading →

The media storm over Michael Lewis and his new book about high-frequency trading is fascinating to watch — and of remarkably little consequence. Serious retirement savers are not affected by flash trading and, quite possibly, benefit from its existence. Lewis is a great writer. I suppose his publisher welcomes the attention the book has gotten… Continue reading →