Featured entries from our Journal

Details Are Part of Our Difference

Embracing the Evidence at Anheuser-Busch – Mid 1980s

529 Best Practices

David Booth on How to Choose an Advisor

The One Minute Audio Clip You Need to Hear

Tag: DFA

Wall Street Journal “Discovers” DFA and Passive Investing

passivista

While we don’t think of ourselves as the passive types, it’s interesting to see The Wall Street Journal shine its bright spotlight on passive investing and related evidence-based investing in its new series, “The Passivists.”

You can browse the entire series, or here are a couple of our favorite installments:


The Dying Business of Picking Stocks,  Anne Tergesen and Jason Zweig

News flash! “Investors are giving up on stock picking.” Our take on the matter: It’s about time.

Making Billions With One Belief: The Markets Can’t Be Beat, Jason Zweig

Featuring Dimensional Fund Advisors, with founder, chairman and co-CEO David Booth reflecting that “A little bit of judgment can make a difference.”


As the media turns its attention to the types of investment strategies we’ve been employing at Hill Investment Group since our founding, we wonder whether this will be a passing fad, a lasting improvement for investors or (as is so often the case in life), a little of both. Whatever. We’ll enjoy the wider coverage while it lasts, and still be encouraging you to Take the Long View with your investments, long after the spotlight has moved on.

How Many Stocks Are In Your Portfolio?

I recently read a study by Wei Dai, a PhD with Dimensional Fund Advisors. The study discussed how diversification (read: the number of securities within a portfolio) impacts the reliability of returns. The key takeaway from her paper was this – broad diversification, combined with long-term investing (5-10 years) can improve the reliability of investment outcomes.

A strategy that is not well diversified may exclude from its holdings the companies that ultimately generate investment premiums. In other words, the odds are stacked against portfolios with fewer names. Wei shows that a well diversified strategy would have at least 200 names while over 75% of U.S. based mutual funds have less than that number. The strategies we employ seek to capture identifiable alpha through broad diversification with well-over 10,000 securities in only a handful of individual funds.

If you are interested in a copy of the paper from Dimensional Fund Advisors, please click here to reach out to a member of our team.

 

 

Featured entries from our Journal

Details Are Part of Our Difference

Embracing the Evidence at Anheuser-Busch – Mid 1980s

529 Best Practices

David Booth on How to Choose an Advisor

The One Minute Audio Clip You Need to Hear

Hill Investment Group