The Correlation Conundrum and What to Do About It: With the rise in correlations, diversification is more important than ever

The Correlation Conundrum and What to Do About It: With the rise in correlations, diversification is more important than ever

Over the past two decades, the amount of equity assets invested passively has increased from roughly 10% in 1993 to about 30% today. At the same time, correlations between individual stocks have generally risen. Let’s take the S&P 500 as an example: Based on the average daily correlation over the trailing six months, correlations have risen from roughly 10% in 1994 to 66% at the end of 2011

The Hour Glass Economy

While global diversification is important, America remains the largest economy on the planet. So, how do you successfully invest in the USA?

This article offers some insights into America's "hour glass economy".

http://www.algemeiner.com/2012/04/09/corporations-plan-for-post-middle-class-america/

Some Helpful Tips if You are Just Starting Out

Morningstar has some suggestions for investing newcomers looking for diversification, especially if you don't have a lot of money to get started.

http://www.morningstar.co.uk/uk/news/article.aspx?articleid=102876&categoryid=5&refsource=newsletter

There's been some negative press about ETFs. This article is about why ETFs (and ETPs - exchange traded products) are a good investment choice.

http://www.morningstar.co.uk/uk/news/article.aspxarticleid=102268&categoryid=5&refsource=newsletter

Ten Commandments of ETF Investing

What began as a handful of securities seeking to replicate widely-known stock and bond indexes has grown into a lineup of more than 1,000 funds, offering exposure to nearly every asset class, region, and investment strategy imaginable. While this impressive growth has enhanced the arsenal of securities available to ETF investors, it has also created the potential for misuse and made finding the right ticker symbol a bit more challenging.

And while ETFs offer countless potential advantages relative to strategies that revolve around mutual funds and individual stocks, there are some potential pitfalls along path to enhanced cost and tax efficiency. Below, we offer up ten pieces of advice that will help to maximize the benefits of exchange-traded products for all types of investors, including tips on minimizing expenses, avoiding potential pitfalls, and picking the right fund for your portfolio.

Huffington Post: DAN SOLIN: Mega-Deficits and Your Investment Portfolio

 

		DAN SOLIN: Mega-Deficits and Your Investment Portfolio
	Most investors would not consider having heart surgery performed by someone without stellar credentials. Yet, they entrust their life savings to "investment professionals" with no formal training in finance.

 

Huffington Post: 1 In 4 Baby Boomers Say They'll Never Retire

 

		1 In 4 Baby Boomers Say They'll Never Retire
	WASHINGTON -- Baby boomers are starting to retire, but many are agonizing about their finances and believe they'll need to work longer than they had...