Many clients come to Sensible Financial with a tangle of investment accounts. We analyze and reorganize their investments to make them more efficient and less expensive.
In my previous article, I introduced my friend Tim who wanted to know how to calculate his fund’s performance. I described the simplest method of calculating returns, holding period return, which is just the percentage change in value of an investment over time. Holding period return has limited value, however, since it assumes that all[Learn more…]
The US Presidential election is fast approaching. It is worth asking whether investment returns vary in predictable ways or are especially risky at such times. Perhaps we should be taking some action? One might imagine presidential elections to have both short-term and long-term effects on the stock market. The short-term effects would reflect the impact[Learn more…]
First, we saw how we could use holding period return to calculate the return of a simple investment with two cash flows, one at the beginning and the other at the end of the period. Next, I introduced the concepts of time-weighted return (“TWR”) and money-weighted return (“MWR”), the two preferred methods used by investment[Learn more…]
The long-run economic impact on investments of Brexit is likely to be small, and the United Kingdom will be most directly affected. Stock investors are likely to experience increased volatility as the details of the new agreement between the United Kingdom and the EU are hammered out. Bond investors will likely experience a longer period[Learn more…]
Edward Samp contributed extensively to this article. Many investors have become interested in the impact of their investment decisions on the world in which we live. While the primary objective of your investment strategy may be financial: e.g., allowing you to live comfortably in retirement or putting your children through college, some investors also desire[Learn more…]
Globally, the shadow of the 2007-2009 Financial Crisis continues to color the behavior of financial markets. Unemployment remains high in the United States, and very high in many southern European Union countries: Greece, Spain, Portugal and Italy. Economic growth remains slow. While bank balance sheets have become stronger in the US, there are still concerns[Learn more…]