Letter From the Chairman of Dimensional Fund Advisors

Founder and Executive Chairman of Dimensional Fund Advisors David Booth reflects on the importance of having an investment philosophy you can stick with over the long-term. “After more than 35 years in the financial services industry, I have found that having an investment philosophy-one that is robust and that you can stick with-cannot be overstated.”…

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The Randomness of Returns

An excerpt from the the Letter from the Chairman of Dimensional Fund Advisors, David Boothe: Markets do an incredible job of incorporating information and aggregate expectations into security prices, so it does not make sense to form an investment strategy that attempts to outguess the market. Our approach focuses on using information contained in prices…

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The Financial Detox Radio Show is back on AM760 KFMB!

After a brief hiatus the Financial Detox Radio Show is back at it on AM760 KFMB. The show is prerecorded and airs on Saturdays at 6pm. You can also listen to any of the previous shows by clicking: http://www.wealthmanagementcarlsbad.com/radio.php or by visiting the Financial Detox website: www.financialdetox.com Here are some of the most recent shows: Active vs.…

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Going Global: A Look at Public Company Listings

TRIVIA TIME How many stocks make up the Wilshire 5000 Total Market Index (a widely used benchmark for the US equity market)? While the logical guess might be 5,000, as of December 31, 2016, the index actually contained around 3,600 names. In fact, the last time this index contained 5,000 or more companies was at…

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The Reality of Models

Checking the weather? Looking at a map of the world to plan your next vacation? Guess what-you’re using a model. While models can be useful for gaining insights that can help us make good decisions, they are simplifications of reality. One example of a model is a weather forecast. Using data on current and past…

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New Market Highs and Positive Expected Returns

There has been much discussion in the news recently about new nominal highs in stock indices like the Dow Jones Industrial Average and the S&P 500. When markets hit new highs, is that an indication that it’s time for investors to cash out? History tells us that a market index being at an all-time high…

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Prediction Season

Prediction season is on us, how does predicting the market work? Check out the attached article which provides and excellent point of view backed up by some historical data and evidence. Yes, evidence. Imagine having a portfolio build on evidence and not predictions and guesses. At LWM we choose the later. Happy Holidays from LWM.…

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The Active-Passive Powerhouse

The fastest growing mutual fund company in the U.S. isn’t strictly an active or passive investor. It is both. The following Wall Street Journal article details the recent success of DFA’s growth and further reinforces a key component of LWM’s investment philosophy. The failure of active management and other attempts to beat the market is…

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Global Benchmarks and Election Years

The conclusion of a recent Dimensional study was that making investment decisions based on the outcome of presidential elections is unlikely to result in reliable excess returns for investors. At best, any positive outcome will likely be the result of random luck. At worst, it can lead to costly mistakes. This month we are going…

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Presidential Elections and the Stock Market

Next month, Americans will head to the polls to elect the next president of the United States. While the outcome is unknown, one thing is for certain: There will be a steady stream of opinions from pundits and prognosticators about how the election will impact the stock market. As we explain below, investors would be…

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