I Thought Interest Rates Were Going Up – What Happened?
On March 15, 2017, the Federal Reserve increased interest rates for just the third time since the financial crisis in 2008-2009. Investment theory tells us when interest rates rise, bond prices fall, so rising interest rates are bad for bond returns. However, bonds have performed well since the Fed raised rates a few weeks ago… […]
Interest Rates Are On The Rise – What Should I Do About Bonds Now?
There is much talk and concern about increasing interest rates, which will not be good for bond performance. Below are responses to some of the specific questions we have received from clients. Q: Why have interest rates increased since the election? A: Many of the ideas put forth by President-elect Trump are perceived to be […]
Can Index Funds Become Too Popular?
Once Upon a Time… When we started an investment advisory firm in 1991, it seemed obvious to Bob Ryan and me that structuring portfolios by focusing on asset allocation was superior to the stock picking culture of the day. The ability to implement the strategy with low-cost index funds was still a new innovation, and […]
Another Surprise – Yet Again!
The recent vote in Britain to exit the European Union is yet another reminder of how markets often react negatively to surprises. We cannot help but ask ourselves, “Is it different this time? Maybe this is the event that upends markets as we know them, and I would be stupid not to react!” As it […]
Tempted to Trust Your Gut? – Another Reason to Commit to a Disciplined Strategy
“The three worst words of stock market advice: Trust Your Gut.” That was the headline of a recent article by Jason Zweig in The Wall Street Journal, reporting on a new academic study. Dr. Robert Shiller of Yale, who won the Nobel Prize in economics in 2013, has been surveying investors about their expectations since […]
What’s Happening At Rockbridge
2015 was an exciting year of growth and change at Rockbridge. Market returns were less than ideal for the year, but we continue to see growth in our fee-only business model as prospective clients seek out unbiased advice and professional investment management. We are the leading fee-only investment management firm in Central New York, managing […]
Investing and Action Movies
When we go to a good action flick, we enjoy the suspense and surprises, but no one wants that experience when investing. James Bond and Mission Impossible would not be box office hits without some interesting plot twists, and an occasional victory by the villain, and yet the end result is usually something we expect […]
Patience and Perspective
No one likes to see their savings decline in value. Times like these are not much fun for investors, watching markets “correct” in the face of abundant global uncertainties. As investment advisors, one of our most important jobs is to help long-term investors keep hold of their long-term perspective. Here are some things to consider. […]
How Bad Was This Quarter for Bond Investors?
The benchmark bond index that we follow, Barclays U.S. Government/Credit Index, lost 2.5%, the worst quarter since 1994. In fact the quarterly result has only been worse 8 times in the past 40+ years (162 quarters). The Barclays U.S. TIPS Index had its worst quarter ever losing 7.1% (data only goes back to 1997). Markets […]
Hindsight is 20/20, But the Future is Unpredictable
How many times have you heard someone say, “In 2008 I knew the market was going to crash…” – or some similar statement of prescience? That would be an example of how hindsight creates an illusion of understanding, as described by psychologist Daniel Kahneman, who won a Nobel Prize in economics for his work […]
