Investment Strategy: Gender-Based Differences

Men own penny stocks on Mars and women have a money market account on Venus.

At least I think that’s how the saying goes…

Okay, maybe not quite like that but the point is, there are noticeable differences between genders when it comes to investing strategies. Many of these came to light just recently, since for years it was the norm for the men to handle most couples’ finances. As women became a bigger presence in the work force, waited longer to get married and couples began divorcing more frequently, women found themselves solely in charge of their own finances. Once they began to invest, based on their own values and goals, it became evident they (typically) invest much differently than their male counterparts. As an investor, a professional investment adviser and a woman myself, this idea is intriguing to me, so I decided to explore these differences…what they mean…and what to do about them.

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Do You Robo? There’s An App for That

Could this be the golden age of the mobile app?  Maybe.  Only time will tell.  What is clear is that mobile application software (“app”) is transforming everything from how we reserve a table at our favorite restaurant to how we track our activity, sleep, health and much, much more.  Financial services like banking, personal finance (e.g., budgeting, bill-paying), and investment management, are participating in big ways in the mobile revolution.

To that end, automated investment platforms called robo-advisors are proliferating rapidly.  Nearly all major brokerage firms, mutual fund companies, and even some banks have an up-and-running robo-advisor solution for their customers.  They have intuitively appealing names like “Intelligent Portfolios” etc., and they use a simple algorithm to automatically re-balance portfolios back to a fixed asset allocation determined by each user.  In a nutshell, robo-advisors are an automatic, set-it and forget-it, mobile investment technology aimed at the mass market. Continue reading “Do You Robo? There’s An App for That”

Share buybacks. Good, Bad, or Ugly?

Publicly-traded companies buying their own shares (share “buybacks” or “repurchases”) increase earnings per share by reducing the total number of shares outstanding (identical earnings spread over fewer shares).  It’s commonly positioned as “returning value to shareholders,” because investors who maintain their shares end up owning a larger percentage of total company shares; in turn owning a larger percentage of future earnings.  As of February 10th, S&P 500 companies have announced plans for $99 billion dollars of share buybacks in 2016.   The largest start to the year ever.  Get ready to receive some serious value!

Not so fast – Continue reading “Share buybacks. Good, Bad, or Ugly?”

Plenty of Millennials Fit A Generational Stereotype…Just Not The One You Think

My chops for penning this blog are that I am both a baby boomer and an employer.  The social media biosphere is replete with (mostly) well-intentioned advice for what millennials need to do to excel in the workplace.  These “rules” are usually handed down by older people who are well-established in their careers and hold positions of power and authority–in short–by baby boomers, who constitute a large majority of today’s professional power brokers, successful entrepreneurs, corporate executives, etc.

Boomers are notoriously work-centric, goal-oriented, self-reliant, and competitive.  Too often they find millennials self-absorbed, lazy, entitled, and narcissistic.  Is it any wonder that the two generations might butt heads in the office?  I think not–and that’s assuming a millennial can win a job from a boomer hiring manager in the first place.

Continue reading “Plenty of Millennials Fit A Generational Stereotype…Just Not The One You Think”

Learn to Be a One-Man Wolf Pack

“…Well all my friends were doing it!”

“If all your friends jumped off a bridge, would you too!?!”

As kids, we all had some variation of this conversation with our parents, right?

So, as adult investors, we know that we shouldn’t blindly purchase a stock just because everyone else is, right? Unfortunately, no. Over time, individual investors consistently buy-high and sell-low, despite trying hard to do the opposite. The root of this trend is that, even after lectures from mom and dad, human beings find comfort in numbers.

“But Mommmm, everyone else is buying that stock!!”

Continue reading “Learn to Be a One-Man Wolf Pack”

Panic is Not An Investment Strategy

U.S. stock performance was up ~6% in March, lifting equities out of correction mode after January’s sharp sell-off. But is that enough to restore the investor confidence that’s been lost? Volatile times like these can make or break successful investment strategies.

Shattered investor confidence can lead to a self-fulfilling prophecy, like bear markets or corrections, even as leading economic indicators are signaling a much less dire scenario. Continue reading “Panic is Not An Investment Strategy”

The ABC’s of Exchange Traded Funds and Traditional Mutual Funds

When an investor opens their portfolio statement, they may see both traditional mutual funds and exchange traded funds (ETFs) in their portfolio. These are common investment vehicles, yet few investors understand the differences between the two, or how a professional money manager can help them navigate the intricacies of fund options.

The similarities of the two fund types are easy: both are baskets of stocks, bonds, or other assets – and they allow investors a relatively inexpensive way to diversify their portfolios. The differences appear in how the two types of funds trade, and the breadth of their respective holdings.

Mutual funds are the elder of the two types of funds, having been around since the 18th century. Partially because these funds have been around longer, there’s a good chance an investor can find a mutual fund with at least some coverage of the market area she/she wants to invest in. For more popular investments (e.g. technology), there are many mutual funds that hold similar assets. An added nuance of mutual funds is that they only trade once per day, at the end of the trading session – regardless of what time investors hit the “buy” button! This might not sound like a big deal, but it’s akin to committing to the purchase before you know the price…not an ideal situation for any investor.

Continue reading “The ABC’s of Exchange Traded Funds and Traditional Mutual Funds”

There’s No News Like Bad News

Wall Street forecasts for global GDP growth, earnings, and stock prices run the gamut for 2016. That means there are intelligent, well-reasoned analyses for both optimism and pessimism regarding where stock prices are headed. Why then, do negative headlines garner more attention and airtime?


The answer lies in a 1979 Nobel Prize winning study showing the overwhelming majority of investors dislike investment losses more than they like investment gains. This is the investing version of human history where threats to our survival have always been more urgent than opportunities to do something more than just “survive.” Be a pessimist and you’re a market sage who manages to peer past the obvious. Conversely, optimists, like Wharton Professor Jeremy Siegel, personify those negatively viewed as “perma-bulls” for traditionally positive outlooks of the stock market – a view Professor Siegel has held since the 1980’s. An inconvenient truth for the pessimists though; since the 1980’s the S&P 500 has increased in value 1,573%. Absolutely, it pays to invest with caution, but don’t let too much pessimism keep you from making money.