Author: Colby Davis

Everything Keeps Getting Better: 2018 Edition

Everything Keeps Getting Better: 2018 Edition

Do you ever get the feeling that the only news they report is bad news? Well if you’ve ever wondered why that is, there is someone you can blame for the media’s persistently negative outlook: yourself. It seems the media mostly just gives us what we want, or at least what we click on, and […]

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Where’d All the Risk Go?

Where’d All the Risk Go?

America is more divided now than ever, a hostile foreign power is openly threatening us with nuclear weapons, and we don’t even know what next year’s tax rates will be. In this era of acrimony and uncertainty, surely the market must be a roller coaster ride of volatility right now… Hahaha yeah right. VIX data […]

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Bitcoin; and other Fun Ways of Setting Your Money on Fire

Bitcoin; and other Fun Ways of Setting Your Money on Fire

Alright, bring on the hate mail! As I promised in my last post, today I give you more than you ever wanted to know on why Bitcoin is an investment you should probably avoid. I have resisted the temptation to write about Bitcoin on here for a while, partly because I am sure there is […]

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3 Investments to Avoid in an Expensive Market

3 Investments to Avoid in an Expensive Market

You’ve probably heard it, maybe you’re worried about it: stocks are expensive, bonds are expensive, real estate is expensive, it seems like just about everywhere you look markets are overvalued. Are we in the mother of all bubbles? In my last post, I tried to assuage some of these concerns and point to some corners […]

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3 Investments to Consider for an Expensive Market

3 Investments to Consider for an Expensive Market

Here’s a concern we’ve been hearing from investors more and more lately: There aren’t any good investment opportunities right now. Stocks are expensive, bonds are expensive, and cash is still paying next to nothing (and less than nothing after inflation). How is an investor supposed to make any money in an environment like this? Since […]

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Profiting from the Recklessness of Others

Profiting from the Recklessness of Others

A couple months ago, I wrote about the dangers of levered ETFs, showing how these products designed to juice investor’s returns end up eroding capital due to the subtle mathematical logic of compounding. In my last post, I followed up on the topic by describing the Kelly Criterion, a mathematical framework that can tell investors […]

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The Line Between Aggressive and Crazy

The Line Between Aggressive and Crazy

Suppose I offer you a bet. Flip a coin, heads you lose your entire bet, tails you win it back plus one and a half times, so a ten dollar bet becomes $25. And furthermore I’ll let you keep making this bet as many times as you like over the next hour, say. This is […]

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“Make it a Quadruple”

“Make it a Quadruple”

This month, the financial press has been abuzz with the latest case study in Wall Street’s storied history of feeding speculative frenzies: the quadruple-levered ETF. On May 2 the SEC approved a request to list two ETFs, the ForceShares Daily 4X US Market Futures Long Fund under the ticker UP, and the ForceShares Daily 4X US […]

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A Permanent Bear Market in Fossil Fuels?

A Permanent Bear Market in Fossil Fuels?

In my last post I wrote about how the financial industry, led in particular by asset manager BlackRock, may begin putting pressure on the private sector to reduce carbon emissions and otherwise adopt more environmentally friendly practices, for entirely self-interested, profit-motivated reasons. Since then, I’ve been thinking a lot about the future of energy production, […]

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BlackRock Goes Green

BlackRock Goes Green

When it comes to the financial markets, I am a perennial optimist. Investing not only makes us richer in the long run, it makes the world healthier, happier, and better in almost every dimension. My optimism extends even to the ability of financial markets to solve what economists call coordination problems, an excellent and timely example […]

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