Investing Education
Discover a wealth of investing information, articles, tips and advice for how to intelligently manage your risk and increase your returns.SmartStops Featured Articles
Did You Corona Virus, COVID-19, Proof Your Portfolio? Did You Protect Your Investments?
When will people learn to protect their investments? Why don't people deploy Smart Trailing Stops as an approach even if it's a reactive Risk Alerting basis vs. proactive setting of stops? You can never know how the markets will react. All you can do is have your...
The 6 Biggest Mistakes Ordinary Investors Make
"What's the biggest threat to achieving financial independence? Your own brain!" Nobel-winning prize theory and research from psychologists (Kanheman & Tversky) led to the beginnings of what is now called behavioral finance, with Thaler bringing that into the...
Why Protect? Limits of Diversification from State Street
Great white paper by State Street Global Advisors that highlights the limits of diversification and the importance of risk protection: "Good downside protection can benefit portfolios in several ways. Studies, such as that by Bhansali and Davis (2010), have shown...
WARNING! Time to protect your Investments!
Now don't say no one's warned you about an upcoming stock market correciton. It's inevitable. So are you going to protect your gains or what?! https://www.bloomberg.com/news/articles/2017-11-29/goldman-warns-highest-valuations-since-1900-mean-pain-is-coming
Are Markets Rational or not?
SmartStops comment: Glad to see Richard Thaler win the 2017 Nobel Prize for documenting the way people's behavior actually does not conform to economic models that portray them as perfectly rational. As he states: (Investors) "refuse to cut their losses on...
DIY’er investors are doing better then clients of Financial Advisors!
SmartStops comment: just came across this interesting point that indicates the DIY'ers are doing better then clients of Financial Advisors: .. These added services (education etc. from brokerage) seem to be helping, as self-directed investors tend to see quite a bit...
The Higher They Climb, The Harder They Fall
SmartStops comments: It's befuddling that this statement continues to get touted around - "But isn’t this market timing? We all know, after all, that timing the market is pure folly!" .. when indeed guru's like Andrew Lo, MIT have blown this "myth" apart again and...
Less Risk. More Caution.
LESS RISK. MORE CAUTION. Good point by Howard Marks of Oaktree Capital on the markets these days: "It’s all about investors’ willingness to take risk as opposed to insisting on safety. And when people are willing to take risk , and not concerned about safety...
Lessons From a Trading Great: Stanley Druckenmiller
SmartStops comments: If you study successful investors, you will find that they don't necessarily follow a diversification rule. That was created many many years ago with the advent of Modern Portfolio Theory however even MPT has morphed now. Read more about some...
SmartStops = Smart Beta
Yes, our premise for needing more risk-based approaches in the market has been validated with the rise of Smart Beta ETFs. As the image below points out - access to "risk premia" previously only available through expensive active strategies in a cheaper way" ....
Will the stock market ever catch up to our volatile President Trump?
SmartStops comment: It's alarming to think that Trump has no senior trained economists in his midst. And that one who has given some advice has been told to keep quiet. "The stock market is up about 15 percent since the election — despite the considerable...
Markets take the stairs up and the Elevator down
SmartStops comment: Great article about the nature of our 21st century markets and why one needs to stay protected in a fluid geopolitical environment . Some interesting graphs are presented. The article concludes: Perhaps more than any other time in the last six...
Earn higher returns by avoiding the downturns
Just look at how much per share one could save in this example with IBM below. Stepping aside during a stock's downturn can lead to higher returns overall for your investments especially when you consider that stocks on average will drop ~20% from their highs and...
Why Investors Face Roller-Coaster Markets
This article does a great job at educating mainstream investors and the underlying aspects of our 21st century market. Written by the Chief Economic Advisor, Allianz and Chair of the President's Global Development Council: Key points: Because today's markets are...
Are Company’s Profit Reports “Phony?”
SmartStops Comment: This is why you always need a smart objective third party managing the risk of your investments. as reported by the AP: Those record profits that companies are reporting may not be all they're cracked up to be. As the stock market climbs ever...
Modern Portfolio Theory is Harming your Portfolio
SmartStops comment: an excellent article that every investor should read as MPT continues to be deeply entrenched in our systems. Its shortcomings are proven. The article concludes with: The advice that most investment advisors give their clients - At its core, the...
$1M more in your IRA by avoiding major losses
SmartStops Comment: Modern Portfolio Theory - continues to have holes poked in it. Here's a post by Hedgeable reiterating the importance of missing the worst times in the market. From their post: If you merely miss out on 75% of market losses during the two...
Why You Should Shift From Profits To Protection
SmartStops Comment: We couldn't agree more with this author. From Seeking Alpha, Contrarian Profits The bulls are back out in force, as the hiccups from a few weeks ago seem a distant memory. Indexes have resumed breaking records on a regular basis, and all seems...