What Are Stronger Negotiation Skills Worth?

I’ve been teaching people to strengthen their negotiation skills for over a quarter century.  Becoming a better negotiator brings significant rewards in our modern lives.  Negotiation really matters in the pursuit of better outcomes. It would be fair to ask, though, what exactly are we talking about. What is this thing that I am teaching […]

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The Financial Services Industry Benefits From Information Imbalance – You Don’t

For several decades, I’ve written, lectured, and consulted on the difficulties of getting good advice about personal finance. Among the problems is a pervasive imbalance of information. When one party to a transaction knows a great deal more about the subject than the other, there is the potential for exploitation. Most financial practitioners have command […]

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To Find a Fiduciary, Look For a True Professional

        There has been a lot of talk in Washington DC  recently as to whether all financial advisors should be held to a “fiduciary duty” in their dealings with investors.  From my point of view, it is hard to see what could possibly be controversial about insisting that those who guide others […]

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Is There Really a Tax Loophole for Hedge Fund Managers?

  Almost two years ago, I wrote a piece entitled “Do We Really Need A Special Tax Break for Hedge Fund Managers?”   After briefly explaining how “carried interest” works, it argued that anyone less rich and powerful trying to pull of such a capital gains switcheroo would end up in jail. I took particular pleasure […]

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A Rather Modest Fiduciary Proposal Draws Fire

In a recent speech, President Obama announced support for a Department of Labor initiative to impose a fiduciary duty on those who give advice about tax deferred retirement investments such as IRA accounts.  It is a modest proposal. Judging by the howls emanating from an industry fearing it could cut into profits, though, you might […]

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To Be a Great Negotiator You Must Get Fully Prepared

There are a great many practices, behaviors, and skills that set great negotiators apart from more typical bargainers. Indeed, enough to fill an entire book.    Probably the single most important of these, however, is preparation.  To put it plainly, the best negotiators prepare fully and carefully for any important negotiation. It is no surprise […]

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Negotiating Investments

Investing is a Series of Negotiations

Most of what you do in your financial life involves negotiating. In particular, investing is a series of negotiations. As an investor, you seek a deal in which you will exchange payment for some instrument that (hopefully) will appreciate in value. This may be a stock (an ownership interest in an enterprise), a bond (debt), or some sort of commodity (a thing that has value). Or the object of the deal may be some derivative or combination of these things.

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Mutual Fund Selection

Ever Wonder How Investment Advisors Choose Specific Funds?

I sometimes ponder how brokers and advisors choose this fund over that one.

After all, economic theory suggests that they all tend to perform in tandem with others investing in the same asset class. In such a case, the lion’s share of performance variation will be attributable to how much is charged to run the fund. Absent the advisor’s own pecuniary interests, I wonder if the choice isn’t totally arbitrary. Sort of akin to reaching into a barrel of monkeys and pulling out the first one you grab hold of.

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Avoid Investments That Do Not Trade

When contemplating a potential investment, how can you know if it is fairly priced? Such a determination is critically important since even the best company will prove a poor investment if its stock is purchased too dear. Paying a fair price for an investment vehicle is just as important as not overpaying for a house, […]

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Don’t Choose Between Investments, Buy Them All

If the expected return from two similar stocks is the same, how should an investor decide in which one to invest? The best answer is she shouldn’t. In most cases, the wiser choice is to buy some of each. The two investments will offer the same theoretical expected return but with lower overall risk. This […]

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