Model Investing Articles

Evidence from numerous studies on behavioral finance suggests that the need for emotional comfort costs the average investor around 2-3% per year in foregone investment return. This shortfall, commonly referred to as the "behavior gap," stems from the fact that optimal long-term financial decisions are often very uncomfortable to live with in the short-term.

If you've ever worked with a financial planner or investment advisor, there's a good chance you're using an investment strategy known as strategic asset allocation. While you may not know it by that name, you're probably familiar with how it works. What you may not be of aware of, however, are how recent changes in financial markets have made this approach to investing more dangerous than ever before.

Over the last few years a number of automated investment services, known as robo-advisors, have opened their doors. These services are designed to provide ordinary investors with sophisticated portfolio management at a fraction of the cost of a traditional financial advisor. Their growing popularity has caused a stir in the investment community, but just how good are these robo-advisors?

You shouldn’t invest in stocks simply because you’re young. Nor bonds just because you’re old. Your decision to be invested in either stocks or bonds should be entirely based on how those asset classes are likely to perform in the months and years ahead. And as conditions change, you need to remain nimble, ready to adjust your portfolio to accommodate new developments.

Jim Cramer's Actions Alerts Plus is a subscription service offered through TheStreet.com. It allows investors to trade alongside Cramer as he makes investment decisions for his charitable trust stock portfolio. With over 70,000 paid subscribers, the service appears to be very successful. But just how well has the Action Alerts PLUS Portfolio performed over time? And how does Model Investing stack up?