"Perhaps the smartest thing an ordinary investor can do is to engage in periodic rebalancing of a diversified portfolio."
Burton Malkiel, PhD, author A Random Walk Down Wall Street
Insight
Published Articles from Craig Israelsen and Andy Martin
I Don’t Like the Fed by Andy Martin
Federal Reserve monetary policy does not work, has not worked, and cannot work.
What Historical Inflation Clusters Tell Us by Andy Martin
Inflation Clusters. If history is a guide, we will deal with high inflation for many more years.
Why the 60/40 is Not Dead, Will Never Die, and Why You Can't Kill It by Andy Martin
Styles change, it is true, but investing objectives do not.
Diversification Wins for Bonds by Andy Martin
Advisors routinely assume the benefits from diversifying across equity asset sub-classes and between equities and bonds. But they ignore the even greater benefit from diversifying among categories of bonds. If advisors widen their asset class choices when building income portfolios, investor outcomes will improve
The Secret to Portfolio Performance Consistency by Craig L. Israelsen
How many funds are needed to create a diversified portfolio? While there is no absolute answer, let’s explore a range of diversification strategies — from a one-fund to a 12-fund portfolio. An important secondary goal when building portfolios is to keep things relatively simple, so the construction and management of the portfolio is not overwhelming.
Does Patience Really Pay Off? by Craig L. Israelsen
Many advisors may have kicked off 2016 by fielding communications from panicked clients, as equities plunged into a sea of red. But does the recent under performance of equities, particularly of large-cap U.S. stocks, mean catastrophe for these clients’ portfolios? Not if they are diversified — and patient.
The 7Twelve® Portfolio: An Introduction by Craig L. Israelsen
This brief report introduces a multi-asset portfolio design that brings a higher standard to the notion of “diversified”. This design is referred to as the 7Twelve portfolio. The name “7Twelve” refers to “7” asset categories with “Twelve” underlying mutual funds. The seven
asset categories include: US stock, non-US stock, real estate, resources, US bonds, non-US bonds, and cash.
2019: A Year of Contrast in Asset Class Performance in the 7Twelve® Portfolio by Craig L. Israelsen
Shown are the 1-year returns for all 12 asset classes in the 7Twelve Portfolio through December 31, 2019. Also shown is the performance of the 7Twelve Passive Portfolio itself. The best performing single asset class in 2019 was large US stocks, followed by midcap US stocks.
Three Essential Points For All Investors by Craig L. Israelsen
We can’t guarantee the performance of our investment portfolio, but with sacrifice many investors can contribute 10% of their income each year into their retirement accounts. Control what is controllable. Our savings rate (or contribution rate) is more controllable than our
portfolio’s performance.
Building a Better Balanced Portfolio by Craig L. Israelsen
It’s time for a better “balanced” portfolio. Way back when, there were two dominant investment categories (or asset classes), namely US stock and US bonds. These two assets became the mainstay ingredients in balanced mutual funds, with the typical ratio being a 60% allocation to large US stocks and a 40% allocation to bonds.
Dear Mrs. Yellen, I Don't Care What You Do by Andy Martin
Fears of rising interest rates have become background radiation, exposing everyone. A recent Eaton Vance survey, Advisors’ 4 Biggest Concerns: Eaton Vance, of 1,006 advisors concluded that, “nearly three-quarters of advisors report at least some concern about a near-term increase in rates, and one in five say they are very concerned.”
Andy Martin at Financial Advisor's Conference on Alternative Investments
What do Greece, China, the Euro, massive world debt, and the US stock market all have in common? They’re all better with alternative investments. That was the message at the 6th Annual ‘Inside Alternatives’ conference sponsored by Financial Advisor and Private Wealth in Denver July 13-14.
The $700 Million Man + Achieving Higher Returns with Lower Risk
In this episode, host Ron DeLegge tells an incredible story about the $700 million man. Ron's program guest is Andy Martin, President at 7TwelveAdvisors.com about his new book titled Dollar Logic: A 6-Day Plan to Achieving Higher Returns by Conquering Risk. Memo to listeners: Ron has analyzed and graded more than $100 million in investment portfolios. Does your portfolio PASS or FAIL?
Must Bond Investors Fear Rising Rates? by Andy Martin
Thirty-one years ago, in 1981, the one-year Treasury reached its all time high of 14%. Today it hovers around 0.10%. Never before have interest rates fallen so far. Many economists and investment advisors, seeing nowhere to go but up, expect interest rates to
climb from these historic lows. But that would not be the catastrophe that many bond investors fear.
Kill the Two-Asset Model By Andy Martin
Like you, I was sitting in my office in fourth quarter of 2008 looking for a safe place from the earthquake of bad news that was pummeling the capital markets. Like you, I was surprised that even my most conservative portfolio — stocked with judicious and sensible mixes of investment grade bonds, large-cap blue-chip stocks and cash — was getting crushed. Dedicated to David Geracioti, former editor Rep. Magazine.
The Rise of Passive and Index Investing, and Its Effect on Market and Liquidity Risk By Andy Martin
The most profound developments in the investment markets in the last 20 years have been the growth of indexed-based investing and the move to passive fund management. What systemic risks arise because of this growth?