A Case Study in the Market’s Long Term Resilience

An article in CNBC recalls the demise of Lehman Brothers in 2008 that “unleashed a new level of panic and pain” in the markets and the highlights how buying shares of the doomed firm would have left investors underwater for a long time afterward—but not forever. From today’s viewpoint, the article says, “buying on Lehman eve has been redeemed and rewarded by the passage of time, the resilience of corporate America and the durability of… Read More

McKinsey Report: Dial Back Expectations on Future Returns

McKinsey Global Institute’s recent report warns investors to dial back their investment return expectations.  The report cites the finance and investment trends that supported the “golden era” between 1985 to 2014 has run its course. A recent article in Pensions & Investments gives insight into these findings.  Timothy Koller, principal and co-author of the report, says “Inflation and interest rates were starting to come down, but investors were still quite concerned whether inflation was knocked… Read More

Investors Need an Iron Stomach to Hold the Best Performing Stocks

Morgan Housel of The Motley Fool writes a good piece on how difficult it can be buy and hold the very best performing stocks over time. As Housel points out, the best performing individual stock from 1995-2015 was Monster Beverage — up 105,000% over that 20 year period. That return would have turned $10,000 into a cool $10 million. But, as Housel points out, Monster has been an incredibly volatile stock, so volatile that most investors… Read More