Active investment management’s weekly magazine for fee-based advisors

The following posts are related to investment theory. Scroll down to see more articles.

Seasonality strategies: Sell in May and go away?

The old Wall Street adage “Sell in May and go away” has some strong support in the data, but probably not in the way most investors think. An excerpt from the book “Why Bad Things Happen to Good Investments,” by William T. Hepburn, explains why and...

Using cash to manage risk and create alpha

An actively managed strategy that moves to cash in times of market stress can effectively mitigate risk, reducing drawdowns and overall portfolio volatility. This is especially important for clients in retirement who are taking regular portfolio...

Why ‘timing’ is critical for investment returns

There are many reasons that dynamic, risk-managed strategies can benefit investors of all ages. The impact of sequence of returns for retirees is one of the more important ones. “What if? A probability-based approach to market uncertainty,”  a recent...

Trend following: As easy as ABC?

The ABCs of technical analysis Technical analysis is the only investment methodology I know of that has one hard-and-fast rule: If a market is at point A and it is headed to point C, and B is somewhere in between, then it will have to pass through B on...

Survive and thrive in the next bear market

Helping clients maintain composure in the face of market volatility pays long-term dividends for your firm. After a long day of conference meetings and presentations, you can’t wait for the happy hour and dinner, which is being held in a beautiful...

Why defense wins in football and portfolio management

A retirement portfolio without proactive management is like driving a car without brakes. Are your clients prepared for the next inevitable crash? Time frames. They are probably one of the most important yet most rarely understood topics when it comes...

Separate? Separately managed? Or both?

Some advisors have an ingrained resistance to using separately managed accounts—but it doesn’t have to be an all-or-nothing proposition. There are perhaps as many styles of investment management as there are people in the financial-services...

The backward nature of sentiment indicators

Investor sentiment is a useful gauge of potential market direction, but not the way many investors believe. As a child, I vividly remember the cliff divers in Acapulco who had to time their dives from high on a cliff into a narrow inlet with each wave....

One way to beat the market

A dynamic, risk-managed investing approach can help minimize the downside in bear markets. That goes a long way toward ‘beating the market’ through full market cycles. Reading Dr. Edward Thorp’s 1967 book “Beat the Market” in the summer of 1968 changed...

A more efficient (and profitable) frontier

Why active management makes optimal portfolios easier to create In his 2011 best seller titled “Thinking, Fast and Slow,” Nobel Prize–winning author Daniel Kahneman explains how people form opinions from complex information, saying, “It is the...