Current views are those of Larry Frank and should not be construed as investment advice. Opinions expressed are subject to change without notice and are not intended to predict future performance.

This material is provided for informational and educational purposes only. It should not be considered investment advice or an offer to buy or sell securities. Any securities mentioned are for illustration purposes only.

Some articles contain the opinions of various authors and not necessarily those of Larry Frank. The opinion of the referenced author is subject to change without notice. All materials presented are compiled from sources believed to be reliable and current, but accuracy cannot be guaranteed. Such articles are provided for informational purposes only.

All materials presented are compiled from sources believed to be reliable and current, but accuracy cannot be guaranteed. All articles are provided for informational purposes only and should not be construed as an offer, solicitation, recommendation, or endorsement of any of the products or services they may describe.

The accuracy of any website information has not been verified. You should consult the sources used by any website as you evaluate the information presented on a website. The use of the information is intended to be informative, however is not to be construed as investment, tax advice, or website endorsement. For your specifics about your tax situation, please consult your tax adviser and/or preparer.

Website page links are meant to take you to that main article for background information. Any advertisements or other information on the page(s), or elsewhere on the website, are not to be mistaken as an endorsement by Larry Frank. See other disclosures included here that address, in general terms, any main blog opinions, etc.

Please note that older links may no longer work. If you come across a link that is not working, please contact me, with a link to my specific blog post containing the broken link, so I may troubleshoot it.

All economic and performance information is historical, unless otherwise indicated, has not been verified, and not indicative of future results.

There can be no assurance that the financial concepts and strategies presented in this material will be successful. Investments are subject to market fluctuation, risk, and loss of principal. Past performance is not a guarantee of future success. Every investment strategy has the potential for profit or loss.

Investors cannot invest directly in an index. Therefore, passive indexed approaches have been developed. Indices are not available for direct investment; therefore, their performance does not reflect the expenses associated with the management of an actual portfolio.

The performance of any index is not indicative of the performance of any investment and does not take into account the effects of inflation and the fees and expenses associated with investing.

Rebalancing may be a taxable event. Before you take any specific action, be sure to consult with your tax professional. Rebalancing does not guarantee a profit or protect against a loss.

Retirement Plan withdrawals prior to age 59 ½ may result in a 10% IRS penalty, in addition to any ordinary income tax (as well as possible State taxes and penalties).

Diversification, which is driven by complex mathematical models, should not be confused with the much simpler concept of asset allocation. Diversification or Asset allocation cannot eliminate the risk of fluctuating prices and uncertain returns and neither assures a profit nor guarantees against loss in a declining market.

It is important to remember that the objective for diversification is to combine the asset classes into a long term portfolio. The combination of asset classes provides a smoothing effect from the weighted average.

Dollar cost averaging does not assure a profit and does not protect against lost in a declining market. Such a plan involves continuous investment in securities regardless of fluctuating price levels of such securities. Investors should consider their financial ability to continue their purchases through periods of all price levels.

The value of bonds decline as interest rates rise, and vice versa.

Buy-and-hold investing cannot guarantee a profit or protect against a loss.

International investing: Foreign securities involve additional risks, including foreign currency changes, political risks, foreign taxes and diferent methods of accounting and financial reporting.

Diversification neither assures a profit nor guarantees against loss in a declining market.

Past performance does not guarantee future results and the principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost.

Do not expect the fund’s quoted past performance to continue in the future. Studies show that mutual funds that have outperformed their peers in the past generally do not outperform them in the future. Strong past performance is often a matter of chance.

Stock investing involves risks, including increased volatility (up and down movement in the value of your assets) and loss of principal.

SA Funds are submanaged by Dimensional Fund Advisers and distributed by Loring Ward. Any mention, directly or indirectly, of any of these entities here is not to be construed as solicitation or investment advice. You need to talk with a qualified adviser to determine a proper application of any concepts anywhere in this blog to your specific situation. Different situations may result in different solutions.

Analyses in this blog generally use Monte Carlo simulations (stochastic modeling), unless otherwise stated, and assume that assets are invested in a diversified portfolio of equities and fixed income holdings, simulations generally use indexes rather than specific securities, and that a systematic withdrawal strategy is employed to generate income, e.g., a total return approach. It’s important to note that there are other ways to obtain income from a portfolio. Purchasing an income annuity is one example, and the marketplace continues to introduce other products aiming to provide lifetime income benefits.

Mathematical results are based on statistical probabilities and are not guaranteed.

The projections or other information generated by Monte Carlo simulations, or in other cases by deterministic calculations, regarding various outcomes are hypothetical in nature, do not reflect actual results, and are not guarantees of future results. Results from a model or calculations may vary with each use and over time. In addition, models or calculations may underestimate extreme scenarios that were unobserved in the historical data on which the model or calculations are based.

Monte Carlo simulations are used to show how variations in rates of return each year can affect your results. A Monte Carlo simulation calculates the results of a Plan by running it many times, each time using a different sequence of returns. Some sequences of returns will give better results, and some will give worse results. These multiple trials provide a range of possible results. Monte Carlo Simulations illustrate the likelihood that an event may occur as well as the likelihood that it may not occur. In analyzing this information, please note that the analysis does not take into account actual market conditions, which may severely affect the outcome of the results over the long-term.

Most strategy discussions are in its purest form—as though an investor were adhering to it blindly, without making any changes over the investment horizon in the future. In the real world, of course, such a situation could not exist, nor should it. Because circumstances constantly change, investors and their advisers need to review portfolio performance and strategy regularly to assess the status of their spending and savings plans according to the specifics of each person’s situation. Examining a strategy in a pure form can help people evaluate the various factors that need to be weighed during each annual review so the strategy and plan may be updated based on specific circumstances.


Past performance does not predict future performance. The future is always unknowable until it happens.

Additional Disclosures