Sunday, February 16, 2014

Are we spending too much time doing active investing?

The More Important Game of LifeWhile the evidence is overwhelming that passive investing is the winning investment strategy, it's also the winning strategy in the far more important game of life. Here's why.
As a passive investor, when I come home from my busy day, I get to sit down with a glass of wine and ask my wife about her day and how my kids and grandchildren are doing. Because I didn't spend my time trying to beat the market, I also got to coach my youngest daughter's softball, soccer and basketball teams. I also read 50 to 70 books each year, do community service, play tennis, and focus on the other really important things in my life.
Investors following an active management strategy spend much of their precious leisure time watching the latest business news, studying the latest charts, reading financial trade publications, and so on. Even if they are among the few who are successful at the active management game of generating alpha (performance above risk-adjusted benchmarks), the "price" of success may have been that they lost the far more important game of life.
The question for you to consider is what are the important things in your life? Is it trying to generate extra returns through active management strategies that require you to "invest" large amounts of your time? Or are the important things in your life time spent with your loved ones, on your faith, your education, your dreams, a worthy cause, teaching or mentoring others? If you don't already know the answer, perhaps this story will help you find it.

Thursday, February 6, 2014

Millionaires reveal 6 Habits for a lifetime of wealth.

  • “Read omnivorously. Use your money to create more money.” —
    Robert Smith
  • “Stay agile, and provide investors with evidence and vision.” — Paul LeJoy
  • “Buy used, not new.” — Marshall Brain
  • “Take a risk in search of wealth.” — Wendy Robbins
  • “Volunteer to help.” — Thomas J. Madden
  • “You can always save money.” — Tyler Drew