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There’s So Much Good Information Out There

June 6, 2018 By Jon Luskin Leave a Comment

You know you’ve made it when you’re on a podcast. I say this joking, as I now have the pleasure of announcing my new role as co-host on the Stay Wealth San Diego podcast. You can check out the episode below:

As I was reviewing the episode (you’re allowed to listen to your own podcast, right?), it hit me just how many times I referenced the shows notes. In the episode, I mentioned many studies and quotes. Listening to me reference other things really drove home that there is so much good information out there.

In the episode alone, I mention;

  • a study by Morningstar that compares investment expenses to investment performance

This is an amazing study. Right here, you have hard evidence – in numbers – that costs matter in investing.

Not only that – but the study comes from a company that has no incentive to publish this kind of information. For Morningstar to put out content that puts their entire business model at risk is insane! (This is because the company not-so-subtly suggests – via their star rating system – that past performers may be a good future investment.) But, Morningstar’s own report shows that costs dictate what will be a good investment – and not past performance.

  • the hilarious commentary on diversification, with credit to Michael Kitces

 

If everything in the portfolio went up at the same time, it would mean you’re not diversified! pic.twitter.com/4zQuSPyB0Y

— MichaelKitces (@MichaelKitces) August 5, 2017

  • another hilarious tweet, this time by Morgan Housel

A book called Shut Up and Wait.

Each page is just this chart. pic.twitter.com/gfggy47U6q

— Morgan Housel (@morganhousel) July 24, 2017

Like the tweet by Kitces (on a different, but related subject), this tweet gets it right. Of course, we can’t tell most people (especially clients) to “shut up.” But, the meaning of the message is clear: investing requires patience.

  • Historical data on the returns of the S&P 500

Oh – did you want daily data of the S&P 500 going back to 1950? And you want it at the click of a button? And you want it for free!? Well, in our magical, amazing world we live in, you can have just that.

In the episode, I use this data to explain that daily investment returns can be hit or miss. The odds are that on a given day, you could lose or make money. But, as your timeline increases, so do the odds that you’ll come out ahead.

Of course, I talk about a lot more than just the above in the episode. But, the goal of this blog post was to share my excitement about the wealth of information that is available today. It is simply amazing!

. . .

You can listen to the latest Stay Wealth San Diego – with its new co-host yours truly – here. I can only hope that you’ll enjoy listening to it as much as I did.

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Jon Luskin is able to work with individuals in all states, except Louisiana, and is a registered investment adviser in the states of California, Florida, Massachusetts, New York, Texas, and Washington. The Adviser may not transact business in states where it is not appropriately registered, excluded or exempted from registration. Individualized responses to persons that involve either the effecting of transaction in securities, or the rendering of personalized investment advice for compensation, will not be made without registration or exemption.

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