Do You Know “The Market”? Can You Beat It?

The highest return for the same risk. Or the lowest risk for the same return. These things are what we all chase.

We are always looking to optimize our risk-to-return ratio. As Tony Robbins would put it, we are searching for asymmetric risk-reward.

“Beating the Market” is a common theme across personal finance books, and implied by money managers everywhere. But what does it mean?

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Best Personal Finance and Investing Books

As we approach a new year, I wanted to share a few of the books which shaped my perspective on money and inspired me to turn my life around after going broke in Las Vegas. Maybe you or someone you know could benefit from a fresh view on money or personal finance, or maybe a refresher for a new start in 2018. Regardless, here I’ve compiled some of my favorites.

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7 Things FICO Won’t Tell You About Your Credit Score (Plus How To Improve It)

I used to be obsessed with conspiracy theories. Some personal favorites of mine are anything about the Denver International Airport, the Bermuda Triangle, or Area 51.

If you’ve ever started down the path of reading or discussing a conspiracy theory, you probably know how easy it is to begin believing and finding evidence everywhere to support it. This is why conspiracy theories can go viral, along with the fact that they are spectacular or outrageous to the point of commanding attention.

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Do You Know Your TRUE Return?

As an accountant, I work with financial statements every day.

I spend a lot of time reviewing P&L’s and balance sheets. And when I signed up for Mint and connected all my accounts, I was pleased (nerdy, I know) to find a sort of “personal balance sheet” which is really the software showing your Net Worth figure.

I didn’t realize until years later that the most important way to track my progress wasn’t as easy to see.

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The Easiest Frugality Hack

The other day, I wrote about my daily budgeting strategy, which is what finally got me serious about budgeting and being mindful of my spending.
The process is straightforward, but I wouldn’t call it simple. It forces you to categorize your regular expenses and identify which of them are more variable or voluntary in nature.
What’s more, if done properly, the process never ends. For instance, each new month means a new evaluation of my baseline expenses, a new assessment of financial goals, and often a new daily spending target. To get the most out of it, you need a certain level of discipline and enthusiasm for your goals.
The concept I want to talk about today isn’t like that at all.

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270 Year-Old Financial Advice From Benjamin Franklin

In my first post, I quoted a few lines from Benjamin Franklin’s Advice to a Young Tradesman (1748) about valuing your time as you would value money.

The clarity of that quote led me to read the entire passage (it’s only a couple pages long), and it was definitely time well spent.

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