A recent academic study confirmed that willingness to take investment risk is affected not only by an investor’s age but by the current economic climate.1 The more conservative risk tolerance associated with age might be considered rational behavior, because older investors may have less time to recover from potential losses and generally need to tap their savings sooner than younger investors.
The three economists made far-reaching discoveries related to the workings of financial markets, asset prices, and behavioral finance. Here’s a closer look at how their research contributed to the formation and refinement of fundamental concepts in portfolio management and long-term investing practices. Father of Modern Finance Eugene Fama introduced the efficient markets hypothesis in the 1960s. It is based on the premise that asset prices adjust quickly and are an accurate reflection of all relevant information. His research found that movements in stock prices are unpredictable, following a “random walk” that makes it extremely difficult for investors to choose outperforming individual stocks on a consistent basis or to predict the right time to buy or sell financial assets (market timing).2 The realization that trying to “beat the market” is often fruitless eventually led to the introduction of index funds designed to track the holdings of broader market indexes such as the S&P 500. At the end of 2012, 373 index funds managed more than $1.3 trillion in total net assets. About one-third of U.S. households with mutual funds owned shares in at least one index fund.3
According to a recent Wall Street Journal poll, 76% of uninsured Americans don’t understand the Affordable Care Act or how it will affect them.1
Nearly 48 million uninsured Americans may need to start preparing and budgeting for upcoming changes because all citizens and legal residents are required to have health coverage beginning in 2014 or pay a tax penalty.2 Open enrollment in the government’s new Health Insurance Marketplace is expected to begin on October 1, 2013, and run through March 2014.3 The marketplace should make it easier to compare coverage options based on cost, benefits, quality, and other features.
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Utilities at a Buy Juncture -A Technical Look at US Equity Sectors and Indexes Bullish Sectors have a rising 140 day moving average Bearish Sectors have a declining 140 day moving average Neutrals have a mostly flat 140 day moving average -Neutrals highlighted white are not trending in a any particular direction -Neutrals highlighted green are trending bullish -Neutrals highlighted red are trending bearish
Palladium Corrects to a Buy Juncture - A Technical Look at Commodities, Indexes, and Other Asset Classes
Palladium Corrects to a Buy Juncture -A Technical Look at Commodities, Indexes, and Other Asset Classes Bullish instruments have a rising 140 day moving average Bearish instruments have a declining 140 day moving average Neutrals have a mostly flat 140 day moving average -Neutrals highlighted white are not trending in a any particular direction -Neutrals highlighted green are trending bullish -Neutrals highlighted red are trending bearish