Market declines are common in equity markets. Stocks do not always go up forever. Bull markets are followed inevitably by bear markets and vice versa. They key point for investors to remember is that when stocks decline it is important to stay the course and not bail out. Unless absolutely necessary it is never a …
Continue reading ‘Major Declines and Recoveries in US Equity Markets: Chart’ »
Investing in equities seems like a unwise decision these days due to a variety of reasons. Buying foreign stocks sounds even more imprudent with US equities performing very well so far this year. An investor looking to put money to work, can easily earn over 5% simply by buying a 1-year CD. Or to earn …
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Allocating assets among various sectors is one way to implement the diversification strategy. This is because the sector that earns the best returns in one year might end up turning the worst the following year. For example, the below chart shows the annual sector returns of the S&P 500 index from 2013 to 2022. We …
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Entrenched industries are extremely difficult to disrupt let alone crush in the US. This is because established players have plenty of advantages over newcomers. For instance, these firms have financial strength, years or decades of data, strong networks and in some cases legal, political and regulatory protections. A classic example of where high tech startups …
Continue reading ‘On the Disastrous Collapse of Insuretech Industry’ »
Over the long term dividends constitute a significant portion of the total returns of any dividend paying stock or investment. Due to the effects of compounding returns tend to multiple many times over the years even if the start point of the dividend yield is low. For instance, the current dividend yield on the S&P …
Continue reading ‘Total Returns for S&P 500 Dividend Aristocrats Index vs. S&P 500 Index : Chart’ »