TWEDDELL GOLDBERG
WEALTH MANAGEMENT

Several clients have asked me recently whether they should sell some stock funds. “Isn't the market too high?” they ask. No question, the market is richly priced today, although by some measures it’s not as expensive as many individual investors think. Moreover, valuation isn’t everything—in fact, as a market-timing strategy, it’s awful. Let’s look at the factors supporting this market and then address the risks. Start with the breadth of the advance. When investors are confi

So many investors have been bailing out of actively managed mutual funds and piling into index and quasi-index funds via exchange-traded funds (ETFs) that, as Bloomberg Business Week points out, we’ve reached the point where there are now “more cartons than eggs.” That is, “the number of market indexes” [most created for ETFs to track] “now exceeds the number of U.S. stocks.” This most recent stampede has long precedent: When investors want something, Wall Street supplies it—

Get used to it: The years of generous, low-risk returns are over for bonds. Almost all investors still need to own bonds because they provide ballast for your portfolio. But to make much money, either you’ll have to take some risk or you’ll have to be content with puny returns—for many years to come. In my view, the best course is to split the difference: Put some of your fixed-income money in safe bond funds and the rest in riskier funds. Continue reading the full article on

After badly trailing U.S. stocks for most of the past decade, foreign stocks are suddenly on fire. Is now the time to load up on them, or is it already too late? And what portion of your stock money should you invest overseas? Consider recent returns. Since the start of the year, the MSCI EAFE index of stocks in foreign developed markets rose 13.3%, and the MSCI Emerging Markets index soared 17.7%. Standard & Poor’s 500-stock index, though it had a not-too-shabby return of 9.