The philosophy called socially responsible investing claims that your investments should reflect your values. The most common implementation of SRI is to refuse to invest in certain companies because you disagree with one or all of their practices.
When the economy and the stock market eventually flag, Wall Street has a convenient scapegoat at the ready: the Federal Reserve and its plan to raise interest rates.
What happens when interest rates rise? Or worse yet, when the markets decide the current bull run is over? A lot of people worry about these two questions. They shouldn’t.
Low oil prices will tank the energy industry. Controversy over fast-track trade will harm U.S. exports. Slow economic growth will stifle the stock market. You hear a lot of predictions, especially in the harrowing aftermath of the financial crisis. This augury is an insidious racket, though, as behavioral research shows.
Whenever stocks hit a speed bump, investors wonder, “Where is the market headed?” It is human nature to seek a prediction to guide our actions. But recent turbulence in the market means little – and can lead investors astray. Here’s why.
Despite their trailing the broad market lately, hedge funds continue to attract money. Why? Part of it may be snob appeal – they are reserved for upper-income folks. Yet they also are a good way to diversify your portfolio. And some actually do spectacularly well.
Why do fewer people own stocks nowadays? Part of the answer is the bad karma of two horrible bear markets, and part of it is generational. Still, there is hope that this situation will turn around.
Why do so many investors like expensive stocks? Because they are popular, and the herd instinct is powerful. Odds are, though, that you end up overpaying, and that’s not good for your portfolio.
Many people are reluctant to invest because they don’t want to be on the losing side. They forget that the purpose of investing is to meet a need: financial security in retirement. You win as long as you achieve this personal goal.
Value investing long has boasted superior performance over time, besting flashy growth stocks like those found in the tech realm. When the market pauses in a rally, let’s explore why. The answer lies in a very unlikely place.