What I've learned since moving to D.C. (some of which should be obvious): 0112

5551.  Most people spend their life searching for something big neglecting something small that they already have;

5552.  Many people chase a dream just because they think it is an easy route to success.  This means the real reason they enter a career is because of their desire to be successful and not because of the passion for pursuing it;

5553.  If you change the way you look at things, the things you look at change;

5554.  Execution trumps knowledge every day of the week;

5555.  History is but a lantern on the stern, which shines only on the waves behind us and not on where we are headed.  The past is not necessarily prologue to the future;

5556.  Waste no more time arguing about what a good man should be.  Be one;

5557.  Money is only a tool.  It will take you wherever you wish, but it will not replace you as the driver;

5558.  When any market falls by at least 10% from its peak, it’s called a correction;

5559.  When a market falls by at least 20% from its peak, it’s called a bear market;

5560.  On average, there’s been a market correction every year since 1900;

5561.  You’ll experience the same number of corrections as birthdays;

5562.  Historically, the average correction has lasted only 54 days – less than two months;

5563.  In the average correction over the last 100 years, the market has fallen only 13.5%;

5564.  From 1980 through the end of 2015, the average drop was 14.2%;

5565.  Fewer than one in five corrections escalate to the point where they become a bear market;

5566.  There were 35 bear markets in the 115 years between 1900 and 2015.  On average, they happened nearly once every three years;

5567.  More recently, bear markets have occurred slightly less often: in the 70 years since 1946, there have been 14 of them.  That’s a rate of one bear market every five years;

5568.  In more than a third of bear markets, the index plunged by more than 40%;

5569.  Bear markets vary widely in duration from a month and a half (i.e., 45 days) to nearly 2 years (i.e., 694 days).  On average, they lasted about a year;

5570.  The stock market isn’t looking at today.  The market always looks to tomorrow.  What matters most isn’t where the economy is right now, but where it’s headed;

5571.  When everything seems terrible, the pendulum eventually swings in the other direction;

5572.  Every single bear market in the U.S. history has been followed by a bull market without exception;

5573.  The U.S. market hits an all-time high on approximately 5% of all trading days.  On average, that’s once a month;

5574.  From 1996 through 2015, the S&P 500 returned an average of 8.2% a year.  But if you missed out on the top 10 trading days during those 20 years, your returns dwindled to just 4.5% a year;

5575.  Aruba is really windy;

5576.  The water in Aruba is very blue;

5577.  There aren’t many locals/natives in Aruba;

5578.  The McCrioyo Sausage (i.e., sausage, egg, tomato, lettuce, ketchup & mayonnaise on Aruban bread) at McDonald’s (in Aruba) is pretty tasty;

5579.  Groceries are expensive in Aruba;

5580.  They take U.S. dollars in Aruba;

5581.  “Doei” (i.e., do-e) is “bye” in Dutch;

5582.  Apparently, Aruba is Dutch;

5583.  In Aruba, it’s pretty much between 80 and 84 degrees every day in May;

5584.  A study by JPMorgan found that 6 of the 10 best days in the market over the last 20 years occurred within two weeks of the 10 worst days;

5585.  If you lose money in the market, it’s because of a decision you made.  The market is going to do whatever it’s going to do, but you determine whether you’ll win or lose.  You’re in charge;

5586.  Let’s assume the stock market gives a 7% return over 50 years.  At that rate, because of the power of compounding, each dollar goes up to 30 dollars.  But the average fund charges you about 2% per year in costs, which drops your average annual return to 5%.  At that rate, you get 10 dollars;

5587.  Professional fund managers aren’t really any better at predicting the future than the rest of us;

5588.  Investing is a zero-sum game.  When two people trade a stock, one must win and one must lose.  If the stock goes up after you buy it, you win.  But you’ve got to win by a big enough margin to cover those transaction costs;

5589.  If your stock goes up, you’ll also have to pay taxes on your profits when you sell the stock;

5590.  An exhaustive study by Nobel laureate economist William Sharpe showed that a market-timing investor must be right 69% to 91% of the time to outperform the market;

5591.  When you look at the results on an after-fee, after-tax basis, over reasonably long periods of time, there’s almost no chance that you end up beating the index fund;

5592.  If a mutual fund is held in a nontaxable account like a 401(k), you’re looking at total costs of 3.17% a year.  If it’s in a taxable account, the total costs amount to a staggering 4.17% a year;

5593.  An actively managed fund that charges you 3% a year is 60 times more expensive than an index fund that charges .05%.  Imagine going to Starbucks with a friend.  She orders a venti caffé latte and pays $4.15.  But you decide that you’re happy to pay 60 times more.  Your price: $249;

5594.  Robert Arnott, the founder of Research Affiliates, studied all 203 actively managed mutual funds with at least $100 million in assets, tracking their returns for the 15 years from 1984 through 1998.  Only 8 of these 203 funds actually beat the S&P 500 index.  That’s less than 4%.  To put it another way, 96% of these actively managed funds to add any value at all over 15 years;

5595.  Of the 248 mutual stock funds with five-star ratings at the start of 1999, just four still kept that rank after 10 years;

5596.  71% of people enrolled in 401(k)s think there are no fees and 92% admit that they have no clue what they are.  But the truth is, the vast majority of plans are characterized by huge broker commissions, expensive actively managed funds and layer after layer of additional, and often hidden, charges;

5597.  The sun is brutal in Aruba;

5598.  Brazilians like to party;

5599.  Apparently, “puseta” means “pussy” in Portuguese;
5600.  Apparently, Aruba is by the equator;