FMD Capital Management

Posts Tagged: investor psychology

What A Time To Be Alive

Written by David Fabian, October 12th, 2017

This morning I saw the graphic below posted on social media as a marketing tool for the new Schwab 1000 Index ETF (SCHK).  The intent of this message is to point out the advantageous expense ratio of SCHK in relation to its competition.  The fund charges just 5 basis points per year to own the 1,000 largest stocks in the United States. Read more

Marrying Active and Passive Management

Written by David Fabian, October 03rd, 2017

One of the latest stories making the rounds on social media is that Warren Buffett is willing to wager (once again) that an index fund can beat active management over a 10-year time horizon.  Buffett made this bet with a prominent hedge fund manager nearly a decade ago with the proceeds going to a charity of the winners choosing.  He handily beat his first opponent and now another contender wants to take a shot at “The Oracle of Omaha”.  Read the complete post here on CNBC for all the details on this potential match-up.    Read more

Everyone Is A Trader

Written by David Fabian, August 16th, 2017

The notorious website Zerohedge has a thought-provoking tagline that reads: “On a long enough timeline the survival rate for everyone drops to zero.”  There’s plenty of truth to that sentiment and drives the philosophical underpinnings of their news and/or investment opinions.   I’m not promoting their outlook, but I will take my own thinking down a similar track and add that:

“On a long enough timeline, everyone is a trader.” Read more

There Are Two Ways To Beat The Market

Written by David Fabian, July 29th, 2017

Active investors are continually looking for innovative ways to beat the market.  They want to believe that some perfect combination of fundamental or technical indicators will lead to the holy grail of outperformance (otherwise known as alpha).

In the broadest sense, there are two ways to beat the market: on the upside or on the downside.  You either take more risk or less than the benchmark. Read more

Great Investment versus Great Timing

Written by David Fabian, June 05th, 2017

The investment universe is littered with articles touting the advantages of various funds or strategies.  I should know.  I have written for the last five years about the characteristics of ETFs and closed-end funds that we consider for our clients.  Some pass my rigorous test, while others are weeded out through careful analysis.

Throughout this time, I have realized it’s easy to compare two or three funds in a vertical category and dissect their merits.  Some will stand out based on costs, while others may promote index methodology, tax efficiency, or security selection as their primary benefits.  Read more