Category Archives: Investing 101

Why Market Timing, Inevitably, Destroys Your Returns

Investing 101

Olympic track and field champion Carl Lewis once said,“Life is about timing.” But he was an athlete, not an investor. And he sang like this.

Timing matters, if you have it. The poor showing of stocks in the last few years might seem to make the argument for timing your buys and sells. But careful analysis shows that your performance, should you be tempted to try it, would nearly invariably be much, much worse. Continue reading

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Finding Fact in Fiction: Types of Investment Risks

Investing 101

Investing always comes down to two types of possible investment risks: systematic and unsystematic. The main difference between the two is that the damaging impact a systematic risk has on a portfolio can’t be helped, while it is possible to safeguard investments from an unsystematic risk. As confusing as the two types of risks sound, these investment definitions can be explained with a little help from the Mayans and one of history’s great fictional moguls, Willy Wonka. Continue reading

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In Managing Your Money, the Easiest Choice Is Also the Cheapest and Best

Investing 101

Have you ever booked a vacation through a discount travel site like Orbitz, Priceline or Kayak? Pardon me for making assumptions, but let me guess how it went: First, you dreamed of laying on a hammock on a white-sand beach with seagulls crowing overhead. You wanted a hotel with a king-sized bed, plush pillows and a swim-up bar. You wanted a nonstop flight. And — oh yeah — you also wanted this at the lowest possible price tag. Continue reading

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