What conditions need to be in place for an asset bubble to continue and how that applies to stocks, cryptocurrency, and houses. Topics covered include: How to determine if there is an asset bubbleWhat are microbubbles and anti-bubblesHow the cannabis stock bubble burstWhat is required to sustain an asset bubbleHow the current runup in home prices differs from the housing bubble in the mid-2000sWhat structural changes have led to the high valuations for U.S. stocksWhat is the Great … [Read more...]
311: Did ETFs Pass the 2020 Market Collapse Stress Test?
How did ETFs function during the 2020 market sell-off and did the indexing bubble burst? which ETF structures failed the stress test and which passed? Topics covered include: Why were some investors, like Michael Burry, concerned about an indexing bubble What are ETF risks such as flash crashes How did equity ETFs function during the spring 2020 sell-off and how they can act as shock absorbers What were some of the challenges that bond ETFs faced in March 2020 How the rise … [Read more...]
268 Plus: More on the Indexing Bubble, ETF Flash Crashes and Tax Efficiency
In Plus episode 268 for the week of September 14, 2019 we continue our discussion on a potential indexing bubble and how indexes can push up the price of certain securities. We also look at why it is so difficult to determine what percentage of the stock market is indexed. We review what can cause a flash crash in ETF shares, including for gold ETFs. Finally, we look at the mechanism that allows ETFs to be more tax efficient than index mutual funds. … [Read more...]
267 Plus: Sept 2019 Portfolio Review, Indexing Bubble and Gold Miners
In Plus episode 267 for the week of September 6, 2019 we review David's portfolio and discuss whether indexing is in a bubble. We also evaluate investing in gold miner stocks versus investing in gold. … [Read more...]
234: Index But Don’t Herd
How and when to use passive indexing strategies without following the crowd. Photo by Davide Ragusa In this episode you’ll learn: How big is indexing and why has it taken so long to catch on.What areas has active management done well.What are ways we can index without following the crowd. Show Notes Jeffrey Gundlach says passive investing has reached a 'mania' – investors should avoid index funds - CNBC Passive investing continues to captivate global audience - … [Read more...]
163: Is There An Indexing Bubble?
How an indexing bubble is manifest, why most active managers underperform and how individuals can structure their own quasi index fund that outperforms the market. Photo by Sebastian Pichler In this episode you’ll learn: How popular is indexing.Why mathematically do active managers underperform.How to outperform a capitalization weighted index.How to build your own quasi index fund. Show Notes The 25 Largest Mutual Funds and ETFs - MarketWatch The Makeup of the S&P 500 … [Read more...]
MNY121 Plus: Indexing and the Use of Leverage When Investing
This week on Money For the Rest of Us Plus we look at potential indicators for when indexing reaches a tipping point in that it has gotten too popular and active management makes more sense. We also look at the prudent use of leverage when investing including when buying a home. Finally, we review the impact on Doubleline Total Return Bond fund of the passing of one of their senior investment professionals. The episode length is 18 minutes. … [Read more...]