Are Target Dated Funds the Best Option?

Posted by Carlos Sera on Feb 26, 2016 12:14:29 PM

To determine if defaulting employees into Target Dated Funds or Glide Path Funds is a good thing, one must first examine the alternatives. An examination of the history of asset allocations by employees before Target Dated Funds were the default option tells us that it is.

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Topics: Articles, retirement

Investment Strategy: INDICES Up vs. Down Markets

Posted by Carl Sera on Jan 27, 2016 2:58:29 PM

In addition to Target Dated Funds, many investors buy passive index funds for their 401k, 403b and IRA retirement plans.  They do this systematically out of every paycheck.  They have recently seen the three major indices fall by over 10 percent, leaving many to wonder what they should do during this market correction. 

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Topics: Articles, Stock market

Is Stock Market Volatility Here to Stay?

Posted by Carl Sera on Jan 15, 2016 3:07:41 PM
Is stock market volatility here to stay?  The answer is yes - absolutely yes.  You see, volatility is just a fancy term for uncertainty, and uncertainty will always be with us.  If the question were rephrased to say is high volatility here to stay then the answer is no - absolutely no.

Why is this? Stock market volatility, as measured by the VIX, is a mean reverting measure, which means that what goes up must come down, and what goes down must come up.  So with recent volatility levels in the mid-20’s, and the historical average volatility around 18, you can expect a drop.  When it will drop is anyone’s guess. 

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Topics: Articles, Stock market

What Is Tax Efficiency?

Posted by Carlos Sera on Jan 8, 2016 11:00:00 AM

Have you ever heard the phrase tax efficiency or tax efficient portfolio?  Whenever I hear it my muscles tighten up, I get a little nervous, I lean forward to hear better and prepare to be wowed.  Not long after, whatever the opposite of wowed is, I am.  Once I realize that nothing has changed on this topic since the advent of governments taxing people on their investments, I scold myself for allowing this topic to capture so much of my attention.  Nevertheless, I have never written a piece on this topic and thought I would share my thoughts.  I urge you to prepare for some wow.

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Topics: Articles, Taxes

The Importance Of Technical Analysis: "Why I Became A Chartered Market Technician"

Posted by Carl Sera on Dec 16, 2015 2:36:38 PM
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Topics: Articles, Stock market

A Financial Tales Philosophy Blog: "What Do CNBC and ESPN Have in Common?"

Posted by Carlos Sera on Nov 12, 2015 3:30:00 PM

A long, long time ago in what seems like a galaxy far, far away, I was a graduate student doing my best to master finance and economics.  There was this one great professor with a mission - it was to teach us to think.  Our twicee-a-week assignment was to read what others had written about finance, economics or business and to find a flaw or fatal assumption.  Each class, we had to come prepared to expose the faulty writing, incorrect assumption or some other clear violation of what, at that time, was the “only one and true way” to view money, finance and economics.  Our source material was the universe of publications and one of our favorites was the Wall Street Journal, the business section of most any newspaper, as well as countless business magazines.

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Topics: Articles

Article Review from Yahoo! Finance

Posted by Carlos Sera on Nov 7, 2013 6:54:26 AM

This is an excellent article:

Higher Levels of Home Ownership Lead to Higher Unemployment, New Study Finds

Often times people don't understand the unintended consequences of what may seem on the surface as a greater good. Who wouldn't be for increased homeownership? Ask around and I'll bet you can't get anyone to say----nope I'm for renting. Three of my 4 children are in the workforce presently and I don't encourage them to buy a house because it reduces their flexibility.

The notion of home ownership for those that are still looking to either establish themselves in a work/community environment or have built up sufficient capital to be able to withstand home ownership risk is just too high. While the objective seems noble our society has always been one where people go to where the jobs are. The increase in costs and regulations associated with buying and selling houses due to our societal need to protect has significantly reduced mobility. If you don't know where you want to be professionally or can't predict where you want to live 5 years from now------rent.

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Topics: Financial Literacy, Articles, home ownership, unemployment, New Study Finds, homeownership, rent