International Tracking Error: Part 3
In this final post in the series on why international index funds performed so poorly in 2009, it’s time to look at currency hedging. Currency hedging is a strategy designed to smooth out the fluctuat [...]
International Tracking Error: Part 2
International index funds and ETFs showed large tracking errors in 2009. In my first post on this topic, I explained how the time differences between North American and overseas markets can make it ap [...]
International Tracking Error: Part 1
Many international equity ETFs showed large tracking errors in 2009. For example, the iShares MSCI EAFE Index Fund (XIN), which tracks European and Japanese stocks, trailed its benchmark index by 5.34 [...]
Review: Why Smart People Make Big Money Mistakes
To be successful with money, it’s not enough to have a good strategy. You also need to avoid the emotional and psychological traps that snare so many investors. Gary Belsky and Thomas Gilovich examine [...]
Bonds v. Bond Funds
In my previous post, I looked at the uneasiness many investors have about bonds when interest rates are poised to go up. Some readers have argued that this discomfort can be alleviated by buying indiv [...]
The Bond Dilemma
With interest rates poised to rise later this year, I’m getting a lot of emails and comments from readers who are wary about investing in bonds. There seem to be a lot of myths and misunderstandings a [...]
Put Your Assets in Their Place
Couch Potato investors hear a lot about asset allocation, but asset location is also an important consideration. Asset location refers to the type of account you use to hold the stocks, bonds, cash an [...]
Adding Gold to Your Portfolio
Unless you’ve been in a coma, you know that gold has been the hottest commodity of the last decade, quadrupling in value since 2000. That’s in US dollars, but even measured in loonies gold is up more [...]
The S&P 500 Effect
On Tuesday, February 16, Berkshire Hathaway will become part of the S&P 500, the most widely followed stock index in the world. While the Dow Jones Industrial Average is more famous, the S&P 5 [...]
Review: The Elements of Investing
Whenever people ask me where they can learn more about Couch Potato investing, I need to answer carefully. Two classic books are Burton Malkiel’s A Random Walk Down Wall Street and Charles Ellis’s Win [...]
