Today I wanted to touch on another common behavioral issue that most investors fall prey to, anchoring. I’ve commented previously on the behavior gap, how behavioral issues lead to investor under performance and specifically how more information often leads to worse investment performance. Anchoring is another behavioral pitfall for investors. I’ll describe what it is first and then show a…
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The importance of valuation for income investors
The price you pay for an investment is the primary determiner of risk. Plain & simple. As legendary value investor Seth Klarman puts it; Risk is not inherent in an investment; it is always relative to the price paid. Uncertainty is not the same as risk. Absolutely! I find that too many income investors are way too focused on uncertainty,…
Introducing the QuantPulse Service – a better way to quant
An optimized, risk-managed approach to quant investing If you’re reading this, you’re interested in learning and more about and using quantitative stock portfolios in your investment arsenal. And hopefully you’re familiar with the basics of this type of quant investing. The basic principle is to take a quantitative and portfolio approach to picking stocks. For an introduction to what this…
Introducing the QuantPulse Service
An optimized, risk-managed approach to quant investing If you’re reading this, you’re interested in learning and more about and using quantitative stock portfolios in your investment arsenal. And hopefully you’re familiar with the basics of this type of quant investing. The basic principle is to take a quantitative and portfolio approach to picking stocks. For an introduction to what this…
MLP valuation for January 2012
It’s a good time to update the valuation for one of my favorite sectors for income investors and retirees, MLPs. MLPs had another great year in 2011, especially during Q4. The sector returned 14% for the year vs 2% for the SP500. I’ll spare everyone the suspense buildup of the next 600 words or so and say that I think…