Resources

Persistent Returns for Active Managers Remain Elusive

Outperforming active funds rarely manage to repeat their success. Larry Swedroe, Director of Research, The BAM Alliance Since 2002, S&P Dow Jones Indices has published its biannual S&P Indices Versus Active (SPIVA) scorecards, which compare the performance of actively managed equity funds to their appropriate index benchmarks. Its midyear reports focus on the question of…

The Perils of Owning Individual Stocks

Hope vs. wisdom and investors’ failure to diversify. Larry Swedroe, Director of Research, The BAM Alliance Individual stock ownership offers both the hope of great returns (finding the next Google, for instance) and the potential for disastrous results (ending up with the next Lehman). Because investors are not compensated for taking the risk that their…

Factor ETFs Raise the Active Bar

Larry Swedroe on research into how factor ETFs impact the way investors evaluate active managers. Larry Swedroe, Director of Research, The BAM Alliance In our book “The Incredible Shrinking Alpha: And What You Can Do to Escape Its Clutches,” my co-author Andrew Berkin, director of research for Bridgeway Capital Management, and I document the persistent…

Problems With the Factor Zoo

Larry Swedroe explores research into data-mined anomalies and how to reduce “p-hacking” risk. Larry Swedroe, Director of Research, The BAM Alliance Since the mid-1990s, factor-based exchange-traded funds have experienced spectacular growth. By mid-2016, these funds had about $1.35 trillion under management, accounting for about 10% of the market capitalization of U.S. traded securities. At its…

Hedge Funds Trail Equities

Larry Swedroe reviews how hedge funds have performed through the first quarter of 2017. Larry Swedroe, Director of Research, The BAM Alliance Hedge funds entered 2017 coming off their eighth-straight year of trailing U.S. stocks (as measured by the S&P 500 Index) by significant margins. And for the 10-year period ending 2016—one that included the…

Factor Persistence & Diversification

Does popularity impact size of premiums? Usually but not always, if the factor meets Larry Swedroe’s criteria. Larry Swedroe, Director of Research, The BAM Alliance Financial research has uncovered many relationships between investment factors and security returns. Given that popularity is a curse in investing, the growing popularity of factor investing has led to worries…

Annuities … The Good, the Bad and the Ugly

Not all annuities are created equal. Joe Delaney on avoiding the ones that don’t fit your needs. Joe Delaney, Lifeguard Wealth, San Rafael, CA Too often, I’ve heard this all-too-familiar story. A client brings in an annuity policy to review, either for themselves or a family member. They bought it to create a steady annual…

IPOs An Overhyped Investment Idea

Larry Swedroe explains why IPOs don’t offer a lot of rewards for average investors. Larry Swedroe, Director of Research, The BAM Alliance IPOs involve a great deal of uncertainty, which makes them risky. Thus, investors expect higher returns as compensation for the higher risk. However, there is a large body of evidence that demonstrates that,…

©2020 Champion Advisors