Many investors believe a market correction is around the corner, as stock returns seem to have been too good for too long. While investors should always be prepared for turbulence, a review of history suggests these market highs won’t last long for a much different reason.
New York Times columnist, Ron Lieber, examines the hidden dangers lurking below the surface of an asset most investors view as being safe.
Q: With the recent news that one of the world’s highest-profile bond managers eliminated his fund’s exposure to U.S. Treasury bonds, should we be selling our Treasuries, too? Do other types of bonds now offer better return opportunities?
After accurately predicting the Global Financial Crisis in 2008, Robert Rodriguez and Peter Schiff quickly came to be viewed as investment gurus who could provide shelter from the storm. Investors eagerly followed their advice in anticipation of the fortunes certain to follow. How did they fare?
Q: I heard an investment joke the other day, and it seems to be a valid critique of index fund investing. I’d like your response. The joke goes something like this, “A stock picker and an index fund investor are walking down the street. The stock picker suddenly stops, points to the sidewalk below, and says ‘Hey, look, there’s a $20 bill.’ As he bends over to scoop up the found money, the index investor says, ‘Don’t bother. If that were a real $20 bill, someone would have picked it up already.’” What is your response?