SUPPOSE YOU WERE presented with two prospective investments. On the surface, they look similar, except one has outperformed the other in 12 of the past 15 years. Which one would you choose?
This example isn’t hypothetical. The two investments in question are the S&P 500 and the EAFE Index. The S&P 500 is broadly representative of the U.S. stock market, while EAFE stands for Europe, Australasia and Far East. It’s the most commonly referenced index for developed international stock markets.

YOU’VE PROBABLY HAD the same experience I’ve had when shopping for clothes. Spring’s in the air—a great time to take advantage of the local clothing store’s annual winter clearance sale. You buy that Ralph Lauren cashmere sweater at 20% off and jaunt home basking in glory. But the next day, while out for a walk, you peek at the store’s window display and see the same sweater, but now marked down 30%. You return home bemoaning your impulsivity.

WHERE DOES THE STOCK market stand? After 2022’s decline, is it now fairly valued—or still overvalued?
When I think about questions like this, I’m reminded of an opinion piece written by Robert Shiller a few years back. By way of background, Shiller is a professor at Yale University and a Nobel Prize recipient. Along with a colleague, he created one of the more well-known and well-regarded measures of market valuation: the cyclically adjusted price-earnings ratio (CAPE).

YOU’VE PROBABLY never heard of Carolyn Lynch. Shopping for groceries, she noticed a new display of panty hose packaged in colorful plastic eggs. She bought a pair, tried them on and loved them. She told her husband, Peter Lynch, the celebrated manager of Fidelity Magellan Fund and vocal advocate of “investing in what you know.” He promptly bought the stock. L’eggs became one of the most successful women’s consumer products of the 1970s.
I recently had my own L’eggs moment.

EMBARRASSED BY YOUR impulse to try the “sell in May and go away” gambit? Don’t be. You’re in good company. Selling stocks in the spring and returning in autumn was a favorite pastime of London financiers and bankers, who abandoned the steamy city for cooler vacation destinations. They resumed stock trading around St. Leger’s, the day of the last leg of English horse racing’s Triple Crown.
The tendency of global stock markets to rise less in the six months from May to October,

IF I MADE A LIST of all the dumb things investors do, I likely committed them all. I chased performance, sold stocks in a bear market, invested in things I didn’t understand—you get the picture.
Yet, despite the numerous setbacks I suffered before I matured as an investor, I was able to retire comfortably. How was that possible? My conclusion: compound growth. Indeed, I believe compounding is a surer way to wealth than picking market-beating investments.

OPEN A FINANCE textbook, and you’ll find discussions of volatility and beta, value-at-risk, the Sharpe ratio, the Sortino ratio, the Treynor ratio and many other quantitative tools for measuring risk. But what should you make of these metrics? Are they an effective way to control risk in your portfolio?
These tools do have decades of research behind them, and they can be useful. But I believe they’re also incomplete. Worse yet, they can be misleading.

INVESTING IS PRETTY simple. If you don’t need to touch your money for 10 years or so, a good chunk of it can be invested in a globally diversified basket of stocks, preferably using very low-cost index funds. The likelihood that your stock holdings will have lost money after a decade is quite low, and exceedingly low if your holding period is 15 years or longer. Moreover, your investment is likely to outperform all other asset classes,

IN THE WEEKS SINCE Silicon Valley Bank (SVB) disintegrated, there’s been a fair amount of post-mortem analysis. In the end, two factors drove the bank’s demise.
First, SVB’s customer base was concentrated among venture capital-backed technology companies. Because of that, nearly 90% of deposits topped the FDIC threshold and were thus uninsured.
Second, owing to 2022’s rise in interest rates, SVB’s bond portfolio took a hit. That sparked concern about the bank’s solvency, prompting depositors to overwhelm the bank with withdrawal requests.

THREE YEARS AGO this month, in the middle of the pandemic-driven market meltdown, I went on a dividend-stock buying spree.
I had just turned 60 and was looking to step away from the corporate world in 18 months’ time to take up a second-act career as an author. As part of my retirement plan, I had a sizable money-market account that I planned to live on for a few years before I started taking Social Security and pulling from my retirement accounts.

MY UNCLE GAVE ME one share of Chevron for my 20th birthday. It was 1995, and he was the stock transfer agent for the company, overseeing its dividend reinvestment plan (DRIP). The share was a modest $48 gift, but the accompanying advice became the foundation of my investing career for the 27 years since.
As a young kid, I would comb through the business section of the Pittsburgh Post-Gazette, monitoring the performance of my dad’s two mutual funds.

PUBLISHED IN 1958, Common Stocks and Uncommon Profits by Philip Fisher was the first investment book to make The New York Times bestseller list.
Never heard of Fisher? Berkshire Hathaway Chairman Warren Buffett points to two key influences on his investment thinking: legendary value investor Benjamin Graham—and growth-stock proponent Phil Fisher. Indeed, I’d argue that Fisher’s words of advice on bonds, dividends and war scares are as relevant now as they were in 1958.

I’M A 70-YEAR-OLD retiree with a conservative fund portfolio. I have 65% in short- and intermediate-term bonds, Treasury Inflation-Protected Securities (TIPS) and cash, with the other 35% in stocks.
Last year was a rough one for retirees. Rising interest rates and unexpectedly high inflation resulted in a losing year for stocks and bonds. My bond funds lost some 10%. It was one of the worst annual losses for bonds ever. Bonds have only lost value in five of the past 45 years,

IN THE WEEK SINCE Silicon Valley Bank (SVB) failed, a debate has raged: Did the government do the right thing when it decided to guarantee all of SVB’s depositors, including those that exceeded FDIC limits?
On one side of this debate are those who view the government’s action as an inappropriate and undeserved bailout. In an article titled “You Should Be Outraged About Silicon Valley Bank,” The Atlantic argued that the bank’s failure was the predictable result of incompetent risk management.

I WAS A RABID football fan as a kid. I would sweep across our front lawn, fantasizing about the many and varied ways I would run to daylight for Hewlett High School. But when I finally got the chance, I lasted only a few practices. I hadn’t counted on all the bruises that came with the program.
So, too, was it with my brief stint as an independent investment advisor affiliated with a large discount broker.