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It's Never as Bad as You Think (when you think it's bad) as published in InsideNova.com

In my 30+ years in the financial industry, I’ve spoken with countless investors who, countless times over, were convinced that the stock market was about to crash. Every so often, they’ve been correct, at least temporarily.

But I’ve also noticed that the markets have always eventually recovered and continued their long-term ascent. For example, in the early days of Jimmy Carter’s presidency, the S&P 500 Index was at about 100. Today, after 40 years, continuous global unrest, hyperinflation, banking crises, 9/11, Bernie Madoff and many other upsets come and gone … it’s hovering around 2,400.

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The Science of Successful Investing - as published in InsideNova.com

In my last article, I stated that to be a successful investor you need a combination of science and behavioral determination. Today let’s discuss the science side of investing. This involves building a portfolio that offers the best odds for achieving your financial goals with the lowest possible risk. How do we do this? It’s tempting to dive right into picking “winning” holdings. In reality, that’s the last, least vital step:

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The Profile of a Successful Investor - as published in InsideNova.com

In two recent articles, I explained how attempting to predict the near-term future is not investing. It’s speculating. So then, what is investing? Successful investing requires a combination of science and determination. The science is the easier part, so let’s first explore your best investment behavior.

The fact is, we’re often our own worst investment enemy, because we’re inherently hardwired to be bad at it. Numerous studies suggest that most investors’ portfolios ultimately underperform the investments they hold by around 1–3%.

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Better Investor Protections Have Finally Arrived (But Will They Last?)

You may have heard that today, June 9th, the long-awaited Department of Labor’s (DOL) “Fiduciary Rule” goes into effect. Do you care? As an investor, you should. It’s probably the biggest thing to happen to brokerage industry regulations since the Securities Exchange Act of 1934.

Now, when your broker advises your employers’ company retirement plan or advises you on your IRA, they must put your interests ahead of their own.

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Experts Cannot Predict Market Moods - as published in InsideNova.com

What “the Experts” Can’t Know About Investing
In my last column, I discussed the difference between speculating in the market’s short-term moves, versus patiently participating in it as a long-term investor. But what about those “expert” opinions from those who seem to know more about the market than you do? Can you depend on their predictions instead of your own?

Before we explore the question in the context of investing, consider last fall’s presidential election. Throughout the process – and even the day before the election – the political experts were largely wrong.

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Predicting Is NOT Investing (It’s Speculating) as Published in InsideNova.com

In a recent column, I covered why buying gold is more like speculating than investing. A pretty rock, gold doesn’t have or generate any intrinsic value other than what we humans are willing to shell out for it.

Today, I want to build on the notion of investing versus speculating. Even in our stock and bond markets, there are ways to be a speculator and ways to be an investor. Investors patiently participate in the market’s long-term expected growth. Speculators hope to “beat” the market by trying to predict its next moves.

What do I mean by that? 

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Is Gold an Investment? as published in InsideNova.com

Let’s get right to it. For my money, gold is not an investment; it’s speculation.

When you invest, you purchase a slice of human enterprise – a business or public work – or you’re lending your capital to the same. The success or failure of your stock purchase or bond loan is related to whether that enterprise profitably produces something of value to the world.

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The Alphabet Soup of Financial Advice: Part IV - Advisor Fees

No series on becoming an educated consumer of financial advice would be complete without discussing the multiple ways your advisor can be paid.

Why does it matter? First, you want to make sure the advice is adding more value than it’s costing you. You also want to avoid arrangements that pit your advisor’s incentives against your own best interests.

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