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Performance Chasing

Long-term, historical academic evidence demonstrates that over time there are certain “factors” that can provide somewhat higher expected (albeit never guaranteed) returns vs. simply holding a capitalization-weighted market index. Some of these factors that can potentially add a premium return include value stocks, small company stocks, and stocks of companies who have demonstrated consistent profitability.

However, many who attempt to add these premium factors to their portfolios don’t ever reap the rewards of these higher expected returns because they are impatient and get lured into chasing recent performance of whatever has been “hot” of late. Behavioral psychologists identify this behavior as recency bias.

In the following brief, three-minute video we discuss some of these factors with Morningstar and how investors often end up with subpar performance because of their own behavior.

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On the Air

newsradio-WHP-webTim Decker hosts the weekly radio show “Financial Freedom” on WHP 580 AM Harrisburg every Saturday at 10:00 am Eastern.

He brings his extensive knowledge and over 28 years of experience to the discussion of current financial and wealth management topics. Each show also includes a Q&A session when Tim provides straightforward, unbiased answers to questions from callers. This is the program that represents your best interests, not Wall Street's.

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The Sleep-Well-at-Night Investor

The-Sleep-Well-At-Night-Investor

ISI Financial Group helps clients take all necessary steps to properly develop and implement a holistic financial plan using evidence-based, time-tested strategies centered around financial science. In his book, “The Sleep-Well-At-Night Investor,” Tim Decker shows readers how misinformation from the mutual fund industry has created widespread harm amongst investors. The book also discusses the temptation to think of investing like gambling, and the tragedy of gambling away savings and security under the guise of investing.

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