LAST MONTH, The Wall Street Journal ran an article with a puzzling headline: “How China Pressured MSCI to Add Its Market to Major Benchmark.” Like a lot of market news, this arcane-sounding story came and went without much notice. But it’s worth pausing to understand what it was all about—and why it matters to you.
First, let’s decode the terminology in the article’s headline: A “benchmark” is another word for an index.

LOOKING TO BUILD an investment portfolio—or rethink the mix you already own? Check out HumbleDollar’s new portfolio-building guide.
The guide takes the most important advice from the site’s chapters on investing, markets and taxes, and turns it into nine simple steps that should help you build a sensible, low-cost portfolio of index funds. I’ve included step No. 1 below. If you like what you read, I encourage you to peruse the other eight steps.

I SUBSCRIBE TO a number of financial magazines, as well as a daily newspaper. Lately, they’ve been piling up in my garage unread. I scan the front cover of the magazines and the headlines of the newspaper, but I’m not that interested. I don’t care about “Where to Invest Your Money in 2019” or “The Best Stocks for the Long Run.”
I guess it’s because I’m no longer in charge of my investment portfolio.

IN SUMMER 2000, the Art Institute of Chicago fell under the spell of a young hedge fund manager named Conrad Seghers. The allure? Seghers claimed that his funds, called Integral, offered “the highest Sharpe ratios in the industry.” The Sharpe ratio is supposed to measure an investment’s risk relative to its returns and is popular in the world of hedge funds. Convinced by this pitch, the Art Institute committed more than $40 million of its endowment to Seghers’s funds.

AFTER THE MARKET turbulence of recent months, the idea of a 100% stock portfolio would strike many folks as crazy. Yet, when I was in the workforce, that’s pretty much what I owned.
I never felt my all-stock portfolio was particularly risky. My wife and I had solid paychecks to rely on. We always maxed out our retirement plans, while also adding to other accounts, and then lived on whatever remained.
While the stock market’s volatility and the occasional downturns may have been disconcerting,

INVESTORS OFTEN THINK of their portfolio as conservative or aggressive. More conservative investors put a larger percentage of their portfolio in bonds, while aggressive investors favor stocks. But there’s a different meaning of the word “conservative”—what I think of as behavioral conservatism.
Conservatism means you lean toward the safe side. You favor things that are familiar, preferring them to the new and uncommon. The dictionary definition of conservatism is this: commitment to traditional values and ideas,

HAVE YOU EVER PLAYED a round of golf? If so, how many holes-in-one do you have? I’ve been playing since age four and have yet to make one. Even the best players in the world know how difficult it is to make a tiny ball go into a 4¼-inch hole that’s 200 yards away.
I got close once. It was a windier than normal day in Iowa, when I hit my first shot on a par three.

THE YIELD CURVE HAS lately received a lot of press. Specifically, the inversion of the yield curve has many people worried that a recession is around the corner. I’ve been spending a lot of time recently thinking about the yield curve. I need to get a life, right?
You may be asking yourself, “Why should I even care about the yield curve, whatever that is?” Here’s why: The yield curve has inverted prior to every U.S.

IN THE WORLD of personal finance, researchers have long understood that behavioral biases negatively impact investors. Examples include recency bias, hindsight bias, confirmation bias and many others. These are all well documented. Recently, a group of researchers uncovered yet another investor bias: This one is called “alphabeticity bias.”
Alphabeticity, as you might guess, refers to the bias that can occur when choices are presented in alphabetical order. This bias, the researchers note, is found in a number of domains: In elections,

DO THE CHEAPEST index funds always win? A year ago, I tackled that question—and the results for 2017 were mixed. Since then, the question has become even more intriguing. Last year, Fidelity Investments launched four index-mutual funds with zero annual expenses, while also slashing the expenses on its existing index funds.
Those zero-cost funds have only been around for a handful of months, so it’s a little early to gauge their performance. Ditto for the price cuts for other Fidelity index funds;

THE INTERNAL REVENUE Code doesn’t authorize much relief for investors when they suffer capital losses that exceed their gains. It allows taxpayers each year to offset the excess against as much as $3,000 of their ordinary income from sources like salaries, pensions and withdrawals from IRAs.
What about the unused losses? The law lets investors carry forward such losses and claim them in an identical way on their tax returns in subsequent years, until they’re used up.

IN THE HISTORY of the investment industry, May 1, 1975, is a date to be celebrated. On that day, the industry took not one, but two, remarkable steps forward.
The first change was an action by the SEC to deregulate stockbrokers. For the first time in more than 100 years, brokers were given the freedom to set their own commission rates on stock trades. The result was a boon for individual investors. Today, instead of paying hundreds of dollars to trade a stock,

WITHOUT A DOUBT, John C. Bogle is the greatest man I’ve had the privilege of knowing. Tomorrow, the newspapers will run obituaries detailing his many accomplishments—how he launched Vanguard Group, started the first index mutual and was, right up until the end, a fierce advocate for the everyday investor.
I first met Jack in 1987, when I was a callow 24-year-old reporter at Forbes magazine. I last saw him in October, at the Bogleheads’

IN 2005, COMEDIAN Stephen Colbert popularized the word “truthiness.” This term, if you aren’t familiar with it, refers to something which seems like it should be true, but isn’t actually supported by evidence. Are stock market pundits guilty of truthiness? To answer the question, let’s look at a recent event.
First, some background: In the life of an investment analyst, there’s a rare but dreaded phenomenon known as a “profit warning.” This occurs when a company can tell,

ROBERT SOROS, son of billionaire hedge fund manager George Soros, has a surprising explanation for his father’s success: “You know the reason he changes his position on the market or whatever is because his back starts killing him.”
You read that right: The younger Soros attributes his father’s success to a sort of sixth sense—as if he can feel the market in his bones. He goes on: “My father will sit down and give you theories to explain why he does this or that.” But,