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Understanding Quantitative Momentum: Q&A with Alpha Architect

by: Lawrence Hamtil  on Monday, November 21, 2016

The prolific team at Alpha Architect are out with a new book called Quantitative Momentum:  A Practitioner's Guide to Building a Momentum-Based Stock Selection System.  It is a wonderful book for anyone wanting to understand how to implement momentum-based strategies into his or her portfolio, or even just for those who simply want to understand better the concept of momentum investing. Read More

Niche Energy ETFs as Contrary Indicators

by: Lawrence Hamtil  on Wednesday, November 16, 2016

The advent of the exchange-traded fund (or "ETF") has revolutionized the way people can invest, not least because it makes it very easy to compose a portfolio of certain stocks around a given theme.  There are specialty ETFs that track such corners of the market as social media stocks, timber-related companies, and so on.  However, it may be no coincidence that the inception date of some of these niche ETFs has coincided with a peak valuation in the underlying theme.  This is especially true in the energy sector, where once-hot themes as nuclear energy, coal, and solar propelled the launch of several ETFs that tracked the fortunes of these themes, and, perhaps, marked their apex. Read More

Investment Costs Have Never Been Cheaper

by: Lawrence Hamtil  on Tuesday, November 08, 2016

In January of this year, Jason Zweig of the Wall Street Journal wrote about the trend toward zero management fees among several large mutual fund and ETF managers such as BlackRock and Vanguard.  Since that article was published, there have been many other articles and posts discussing the phenomenon of plunging investing expenses.  Given the ubiquity of material on this topic, it is not the purpose of this post to discuss what has already been dissected many times over.  Rather, it is to put the current state of low investment expenses into perspective because I think that, in order to appreciate fully this development, it is first necessary to understand just how high investment costs were even as recently as twenty and thirty years ago, and to consider what implications plunging investment costs may have for markets and investors. Read More