DFA board director Eugene Fama awarded the Nobel Prize in Economics
Eugene Fama of the University of Chicago is one of three economists just awarded the Nobel Prize in Economics. Fama is best known for his formulation of the “efficient market hypothesis,” or EMH. For investors, the main practical implication of the EMH is the superiority of “passive management” (which means matching market returns) rather than […]
Market Commentary October 2013
Market returns continued their upward trajectory again this quarter. The US stock market (S&P 500) was up 5.2% while International stocks came roaring back with an 11.6% return for the quarter. The steady interest rate environment caused bond returns to remain flat, up .36% for the 3-month period ending September 30, 2013. The bond market, […]
Rising Rates Hurt Bond Returns
If you did not know that rising interest rates hurt bond returns, you would be among the majority of US investors according to a recent survey by Edward Jones. The study found that two-thirds of respondents did not understand how rising rates will affect their portfolios. The bond math is complicated, but the result of […]
Boxing Match – Active vs. Passive Management
The active vs. passive investment management debate is one of the most highly discussed topics in the advisory industry. The 24-hour news coverage and the constant barrage of commercials make it appear that beating the market is a very easy task. First, let’s start with a brief definition of the two investment philosophies. Active Investment […]
