Read Doug’s articles originally printed in The Jerusalem Post.
Profile Perspectives
Proper financial planning can change your relationship with money.
3 Things to Know to Sound Smart When Buying Bonds
“Are bonds safe?” asked a fellow in a café who recognized me from the Friday paper. He then looked down and lamented having to pay NIS 22 instead of NIS 14 for his coffee. “Inflation,” I commented. Then he asked for advice about bonds: “If the central bank raises interest rates to control inflation (rising prices),… Read more
Do Market Timers Generate High Returns?
Can market timers outperform the market?
One of the most watched bets in investment history just wound down. Ten years ago, billionaire stock investor Warren Buffett wagered that the S&P 500 Index would outperform five hedge funds over the next decade. The bet was a classic “passive investing” vs. “active investing” showdown…. Read more
What is the Best Way to Teach Children Investing?
It’s never too early to teach children investing concepts.
But do it the right way – not like this: “Boy, will my son be disappointed when he receives an Exchange Traded Fund (ETF) instead of video games for his Bar Mitzva,” a client told me recently when I suggested that she start getting her kids thinking about investing…. Read more
Why a Stock’s Price Doesn’t Matter
There are many factors to consider before buying a stock, but the sticker price shouldn’t be one of them.
This joke illustrates why:
A market analyst walks into a pizzeria and orders a pizza. When the pie is ready, he’s asked, “Should I cut it into eight or 16 pieces?”
The analyst replies,… Read more
Growth vs. Income Investing: Is the Cost of Growth Too High?
According to conventional “growth vs. income” investing advice, if you are a young, upwardly mobile millennial you should put more money in growth stocks that have more risk, but higher potential than other investments. If you’re closer to retirement, you should choose a more conservative investing strategy. Yet even retirees need some growth to counterbalance inflation,… Read more
Should Retirees Diversify Globally to Protect Their Savings?
Retirees who diversify globally protect themselves from investing with too much home bias.
If you are saving for a future retirement, your goal is probably to grow your capital. If you only focus on higher returns, though, you may take risks you cannot afford. Markets are volatile. Diversifying globally may be a good way to lower volatility and smooth out returns…. Read more
Should I Sell Out before Losing Money in a Stock Market Crash?
A retiree called me, nervous about the stock market crashing. He wanted to know if he should abandon the markets by selling his stocks and staying in cash.
An alternative to timing the market
Since you can’t predict when the market will crash, you need a good defense. Historically,… Read more
Are Emerging Markets’ Potential Returns Worth the Risks?
Investors are on track to invest $1 trillion in emerging markets in 2017. Emerging market investments allow investors to try to capture higher investment returns in exchange for higher risks… sometimes significantly higher risks.
Investing in rapid growth
As emerging markets transition to free market economies, they can offer potentially greater economic growth (as measured by gross domestic product (GDP)) than developed countries…. Read more
Will Dividends or Interest Boost My Retirement Savings More?
In a well-diversified portfolio, you normally have three different type of earnings — appreciation, dividends or interest. “Appreciation” is the growth in the value of your investment based on the market going up. Income investors receive “dividends” or “interest” on their investments.
Interest
Interest is what you earn on money you lend out. … Read more
When Does Past Performance in Investments Matter?
When analyzing a company, pundits examine past performance and fundamental assets. On Profile Investment Services’ 20th anniversary, I’d like to focus on both:
The company’s history
In 1997, the Israeli government passed a law that all investment advisors needed to be licensed by the Israeli Securities Authority. Up until that point,… Read more