Researching Retirement: Myths and Realities About Asset Allocations
July 26, 2021
Dimensional’s Research team recently evaluated the ability of common investing and spending strategies to support smooth retirement consumption. We used simulations when researching retirement to compare an income-focused allocation with two wealth-focused allocations that are inspired by real-world target date funds.1 We found that the income-focused allocation delivers similar retirement income with lower risk. Our results differ...
Equity Investing Fixed Income Investing: Investment Principles
July 26, 2021
Fixed income investing is subject to various other risks, including changes in credit quality, liquidity, prepayments, call risk, etc. US consumer prices were up by 5.4% for the year ending June 2021, the largest annual increase since August 2008.1 Naturally, inflation is at the center of attention for many US investors. Our recent paper US Inflation and...
The Next Normal
July 26, 2021
A year ago, at the end of March 2020, the S&P 500 was down nearly 20%1 and the world was scrambling into lockdown. Many experts wrote articles telling us where we would be in a year. I don’t remember reading any that said the S&P 500 Index would be up 56% over the next 12 months....
Climate Change and Asset Prices
July 26, 2021
The economic effects of climate change may be substantial—and may unfold over decades. Climate change can, therefore, affect the future payoffs of a wide range of asset prices Given this strong potential impact, a central question is whether markets do a good job of reflecting climate risk in asset prices. Since the effects of climate...