News

Treasury Market Absorbs Fed's Increase

Contributed by Dimensional Fund Advisors

In our recent paper “Short-Term Rates on the Rise,” we discussed the increase in short-term interest rates that has been underway since 2013. We also posed a complex question: Has the market been leading the Fed to increase interest rates, or has the Fed been leading the market by setting expectations for the purpose of not surprising market participants?

What An Increase In Interest Rates Means For The Investor

By Stephen Hart

Earlier this afternoon, Fed Chair Janet Yellen announced the Federal Reserve would be increasing the federal funds rate 0.25%. While this is certainly headline news, it’s oftentimes unclear how this impacts the investor and consumer.

Sometimes Financial Planning Can Be Tacky

Presentation: Failure is NOT an option

By Brent Everett

Bill Bernstein, in his excellent recent book Deep Risk, discusses the important distinction between two types of risk: deep and shallow. Shallow risk, such as market volatility, is the major concern for most investors. It's also well measured by standard deviation, a key concept in the Markowitz mean-variance framework that's the basis for Modern Portfolio Theory. However, this completely ignores what most people that are attempting to accumulate wealth for eventual retirement should be concerned about.

International Diversification Works (Eventually)

Clifford S. Asness, Roni Israelov and John M. Liew, all from AQR Capital Management, were named co-winners of the annual CFA Institute's Graham and Dodd Award for their article on the benefits of global equity diversification. The award recognizes excellence in research and financial writing in articles in 2011 issues of the Financial Analysts Journal, a publication of the CFA Institute.

Dimensional's Weston Wellington Discusses The Value Of An Advisor

Dimensional VP, Weston Wellington, discusses the value of having an advisor. In March, Wellington spoke to an audience of Talis clients at Gleneagles Country Club in Plano on "Redefining Investment Advice". Take a look at this video to hear Wellington's thoughts on the benefits of having an advisor:

Under The Surface | Inside the systems and processes that drive Dimensional's funds

By Dimensional Fund Advisors

Complex interactions and processes can lie underneath the most simple and superficial action.

Think of what happens when you move a finger. The motor cortex of your brain generates neural impulses that travel down your spine through a bundle of nerve tissues. These in turn trigger muscle fibers in your hand.

Changing how you invest, with a financial plan

By Stephen Hart

If you’ve ever worked with an investment advisor, more than likely you’ve taken a risk assessment test. This is a common practice, in fact if you’re advisor hasn’t suggested that you take one, you may need a new advisor. The risk assessment test uses specific questions related to money and investing to assess the amount of risk you are comfortable taking.

The Skyscraper Index

By Stephen Hart

Earlier this week NPR ran a story on the often cited Skyscraper index. For those not familiar, it’s the belief that the opening of a new batch of skyscrapers often pre-empts an economic downturn. At the center of the story is the new Salesforce Tower being constructed in San Francisco and set to open in 2018. The new tower will be the tallest building west of the Mississippi, and at a cost of $1 billion, will be one of the most advanced buildings ever constructed.

What is a Monte Carlo simulation?

By Stephen Hart

As advisors and financial planners, you may often hear us use the term “Monte Carlo” or say something like “let’s run these details through the Monte Carlo.” So what exactly is a Monte Carlo?

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