Beating the market isn’t everything, or the only thing

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Beating the market isn’t everything, or the only thing, but we sure see it that way. Mutual fund managers and other investment professionals who outperform a benchmark are highly celebrated — and compensated. Outdo the S&P 500 and accolades, attention, and assets are yours.

Yet money managers who make more than the market when stocks rise are really just fleeting celebrities. The true investing heroes are managers who lose less than the market when stocks slide. Investors shielded from the worst of a correction or bear market are simply in a better place, because they don’t have as much to make up when stocks rebound. A portfolio that follows the market down 30%, for example, needs to gain 43% just to get back to even. But if a cautious manager loses only 10%, that portfolio just needs to rise 11% to reach break-even.

Read about how investors should prepare for the next bear market, and check out why one respected market analyst believes U.S. stocks are currently set up for a big tumble. Also, take a look at the case for paying every American a share of the national wealth as a way to ease growing financial insecurity, and see why personal finance guru Suze Orman believes that most people should put any notion of retiring early to rest.

— Jonathan Burton

INVESTING NEWS & TRENDS
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Stock investors can no longer ignore the next bear market

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The average stock is overvalued somewhere between tremendously and enormously

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Stock investors not only buy the most at market tops but pay more for managers, too

What kind of irrationality causes investors to accept exorbitant prices for active management?
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Stocks’ 10-year return is about to spike upward

Retirees need to guard against tricks played with performance numbers
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Why stocks may not rise in the third year of President Trump’s term

The historically strong period might not pan out this time around.
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Long-term investors can beat the S&P 500 by favoring equal-weighted ETFs

Even a broad index fund may not be as diversified as you think. The reshuffled S&P sectors, for example, mean Apple is an even bigger part of the tech segment.
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The case for paying every American a dividend on the nation’s wealth

Automation will displace tens of millions of jobs in the next decade, giving rise to the ‘free money’ movement.
The case for paying every American a dividend on the nation’s wealth

As Vanguard launches a sustainable-investing ETF, its low fees are only one of the factors to consider

Wildly differing views on Tesla is just one example of hard it is to rate companies on ESG criteria.
As Vanguard launches a sustainable-investing ETF, its low fees are only one of the factors to consider

How financial advisers can get the advice they need

Mentors offer experience and guidance at all levels.
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Retire early? You need ‘at least $5 million,’ according to Suze Orman

Suze Orman just threw cold water all over the FIRE movement that’s been spreading across the internet.
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WSJCoin: To understand cryptocurrencies, we created one

In an original WSJ documentary, markets reporter Steven Russolillo ventures to Japan and Hong Kong to explore the universe of cryptocurrencies. His mission: create WSJCoin, a virtual token for the newspaper industry.
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Source : MTV