Happy Holidays and Thank you!

Happy Holidays! Just wanted to drop a quick post with some great links and thoughts for the end of the year. But first I wanted to give a big thank you to all my readers. As I approach my 8th year of writing this blog I have a lot to be thankful for. It’s been quite a journey so far and I’m not even close to done. I appreciate all the support.

The big thing for me this year was the launch of my Economic Pulse Newsletter (see here for the latest changes and end of year pricing). I plan on launching a few more big features in 2018 for the newsletter and will launch a quant stock investment service to help investors out with quant investing. I hope I can continue to provide some insight and practical knowledge about mechanical automated investment strategies, in particular TAA strategies and Quant strategies. That will continue to be my focus in 2018.

Without further ado, here is some recommended reading for the end of the year.

  • Vanguard’s 2018 outlook – the best, most comprehensive, and balanced outlook on expected investment returns
  • My favorite way to look at US stock returns – Professor Damodaran’s implied equity premium. Spoiler: current US equity risk premium about 4% nominal given normalized earnings/payouts and current rates.
  • List of 8 things to do with your portfolio. Great (and rather long) presentation from Newfound Research about what to do with poor expected returns for stocks and bonds. Going tactical is way down the list but the recommendations are great things to do even if you never buy in to TAA/Quant investing. The quick 8; reduce fees, increase savings, better asset allocation, dynamic withdrawal strategies (gee I’ve seen that somewhere before – here are some posts I’ve written on the topic), get risk profile right, increase diversification, embrace factors, go beyond glide paths (going TAA is in this part).
  • Faber podcast of 10 year anniversary of TAA paper. On this podcast Meb Faber reads his new upcoming paper on the 10 year anniversary of his seminal TAA paper, “A Quantitative Approach to Tactical Asset Allocation”. The original paper is what turned me on to TAA so I have a lot to give Meb Faber thanks for. The new paper is due out in early 2018. A good look at out-of-sample results (they’re good) on what he wrote about 10 years ago.
  • Awesome new factor research. When some big academic heavyweights turn their eye towards factor investing you pay attention. Dimon, Marsh, and Staunton, authors of one of the best investment books of all time – The Triumph of the Optimists (read it if you haven’t) – have put out a research paper in factor investing. Alpha Architect has a great summary of the paper here. Spoiler: yes, factors work really well. Momentum rules.
  • Last but not least. Check out this gem of a video on the craziness of the dot com bubble. You think things are frothy today? Keep in mind this video was filmed in early 1997. The stock market when on to double from there before the peak in 2000. Trends are powerful things.

That’s about it. There’s some great stuff on the links above. Again thank you. And Happy Holiday to your and your family.

Full Disclaimer - Nothing on this site should ever be considered advice, research or the invitation to buy or sell securities. These are my personal opinions only.

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