Author - David John Marotta, CFP®, AIF®

1
Hedge Funds and Long/Short Strategies
2
Where Should I Invest Money Which I Will Need in a Year or Two?
3
The Golden Bear: The Bear Market of 1973
4
Planning for a Funeral
5
Recouping Losses Is Not As Hard As You Think

Hedge Funds and Long/Short Strategies

Hedge Funds and Long/Short Strategies

We don’t recommend hedge funds, neither do we recommend long/short strategies.

Hedge funds are not an investment strategy. They are a compensation mechanism which provides a method to bypass the normal regulatory process governing registered investment advisors. Some, but not all, hedge funds actually hedge the market. Some mutual funds also employ a hedging strategy. The most common strategy for hedging the market is called a long/short strategy.

A long/short strategy consists of taking some portion of your investment and purchasing stocks hoping that they will go up. Generally managers presume that they have a methodology for selecting the stocks …

Read More

Where Should I Invest Money Which I Will Need in a Year or Two?

Hello, We recently sold a home. We have about $200,000 to invest for a year or two until we remodel our new home and start our daughters in college. Any ideas where we should put the money? We have already funded our IRAs/401k as much as allowed. Thanks!

The chart in our article “How Long Should I Give An Investment Plan?” shows that you need to give the S&P 500 at least 7 years before the worst return within one-standard deviation is positive, and at least 19 years before the worst return within two standard deviations is positive.…

Read More

The Golden Bear: The Bear Market of 1973

A Bear Market is defined as an index dropping at least 20% from some previous high. Smaller drops in the market between 10% and 20% are called “corrections.” Larger drops of at least 50% are called a “crash.”

Since 1950, there have been exactly nine Bear Markets in the S&P 500 Price Index (the most common representation of “the market”). Only one of these turned into a stock market crash. The other eight stopped dropping before the loss from peak to bottom was greater than 50%.

Although you might think that only eight Bear Markets over 65 …

Read More

Planning for a Funeral

Funeral expenses are often a family’s fourth largest expense after paying for a house, college expenses, and a car. The average funeral costs between $6,000 and $8,000, but it’s not uncommon for funeral expenses to top $10,000. Planning a funeral may be an uncomfortable task, but, planning early will save you or your family members from having to make difficult decisions during a time of bereavement. Last-minute planning often leaves family members feeling pressured to spend more than they should in order to demonstrate their love for the departed.

When my mom was dying, I went with my father to …

Read More

Recouping Losses Is Not As Hard As You Think

There are a number of investment blogs with articles describing what return it will take to earn your money back from an investment loss. I am purposefully not going to link to any of them. They usually use emotionally charged words  to describe how difficult it is to recoup your losses from terrible market declines in order to manipulate the reader with fear to take whatever action the author recommends.

They describe what rate of future returns is required to break even. For example, if you experience a 50% loss in value, it will require more than a 50% gain …

Read More

Copyright 2014 FiGuide.com   About Us   Contact Us   Our Advisors       Login