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I don't follow that method because my portfolio performs markedly better picking individual stocks. It would cost me far too much money to index.

A great article on the revenue impact of tax cuts. Claim That Tax Cuts "Pay For Themselves" Is Too Good To Be True — Center on Budget and Policy Priorities

That is an overused urban legend that is not justified by the facts. Tax cuts lower revenue and increase deficits.

That train has left the station. To split the tax the rollover needed to be completed in 2010.

You may want to make sure your plan allows distributions before normal retirement age. That is one of the drawbacks to relying on 401(k)'s for early retirement. You may not have access to your money until 65. Even if your plan allows distributions before age 65 it could be amended to allow no...

No I was talking about the believers of modern finance theory. Where are all of the superstar investors that adhere to the modern finance dogma. There aren't any. Modern finance theory does not stand up to empirical testing.

If you construe a discussion on finance theory as a sales pitch you have a very active imagination.

Where are all the modern finance experts with records like Buffett. Maybe Buffett is right when he ridicules efficient markets, diversification, beta, VAR and other nonsense.

I know numbers is hard but counting shouldn't be that tough. Are you offended at the idea that some investors can beat the market? Why would you care how often I mentioned it? It seems to strike a nerve with you when I do.

Sub optimal strategy based on what, opinion? So is NFL football, you still have winners and losers. That it is a zero sum game is irrelevant when looking at a small subset of investors. I consider it good odds because of having beat the market in 10 of the last 11 years by on average more...

Relying on failed ivory tower finance theory is not the basis to prove anything. The idea of efficient capital markets has so many holes in it that it is useless. The flash crash is just one small example.

That has already been done: SSRN-Finiteness of Variance is Irrelevant in the Practice of Quantitative Finance by Nassim Taleb Out-of-Equilibrium Economics and Agent-Based Modeling - Microsoft Academic Search SSRN-The Virtues and Vices of Equilibrium and the Future of Financial Economics by...

What mathematical proof is acceptable? There is nothing in the data that says some can't consistently outperform. You bring up a good point. the return of the market is the change in value of all companies less transaction costs. The less investors as a whole pay for transaction costs the...

Yeah, I agree it is overrated maxing out your tax deferred accounts. If you plan on leaving early it pays to have after tax accounts. Especially if you manage them tax efficiently.

Nice post. I am not sure if there is a way to measure whether an investor can outperform the market. That is much different that believing that it can't occur. I know that quarterbacks on average have a 50% winning percentage. If given a choice I am going to take a Tom Brady or a Peyton...

That might be what you imagine it involves, but is not even close to what myself and many investors like myself undertake. There is a fallacy that complex is better. It rarely holds true when investing unless it is a tool to take advantage of the ignorant.

Many find it easier on their ego to believe that all investors are below average. To take that position is to ignore reality. If some are below average, some must by definition be above average. The financial services industry doesn't want to hear any of this type of talk because...

If the market averages 8.35% and a subset is averaging 1.87%, somebody is doing much better than 8.35%. Most of the research on investor performance I have seen is on investors who use mutual funds as an investment vehicle. It is no surprise they don't do better than the market. In order for...

Thanks for the correction. I didn't realize index funds expenses had made it this low.

And every individual investor that can exploit the inefficient allocation of capital promoted by indexing owes a debt to the passive indexer. Indexers pay expenses that are multiple times higher than what is often .07% or less in expenses. Lower than any index fund.

Great post. T-2 is know as a disease of disuse. Knowledge is power. Knowing you have it allows you take steps to get rid of it. Exercise can go a long way to eliminating T-2.

I am about 85% individual stocks and 15% cash. A ton of experience a good temperament and a broad body of knowledge. Institutions are not able to get in and out of small companies providing small investors with a advantage on a number of levels. I am not constrained with limits on the size...

Sounds pretty solid. You can reset your basis even to the point that it may help you realize losses in subsequent years. There are some great tax calculators online that you can use to monitor your progress during the year.

Or you have those who because they can't do it rationalize that nobody can do it.

The tax code changes dramatically each year. Much of the change is driven by lobbyists. Things like 403(b) retirement plans to placate insurance companies. Or tax credits for hybrid cars. Many feel CEO pay is out of control. Investors now have a chance to let companies know on a company...