Modern Portfolio Theory turned upside down

Modern Portfolio Theory turned upside down

Let's start with a brief discussion of modern portfolio theory (MPT)  just to make sure we're all on the same page.   To avoid a less than exciting academic foray into MPT, I'll provide a basic definition.

Basically, the theory is that individual investment (a particular asset i.e. stock or bond) selection should not be chosen on their own merits. What's more important is how each asset's price moves relative to all the other investments in a portfolio.  Harry Markowitz was the first to articulate this concept back in 1952.

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CD or Multi-Year Rate Guarantee Annuity–Is it a fair comparison?

CD or Multi-Year Rate Guarantee Annuity–Is it a fair comparison

Typically a multi-year guaranteed annuity and the term “CD annuity” are used interchangeably within marketing literature.  While the description is accurate in describing conceptually how the product works, I feel it could be a little misleading to consumers.

An annuity is NOT a CD, it’s not related to a CD, and the two really shouldn’t be compared as much as they are.  Later on I’ll get into some of what really makes them different.  The differences may seem subtle to some but they are vitally important to understand.

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What’s The Problem With My Pension?

What’s The Problem With My Pension

For the past few decades, a big part of the American Dream was to go to college, get a great job with a big company, work there for forty years and then spend your days cruising around in your golf cart in some place like Boca Raton, Scottsdale or Palm Desert.

Of course this whole “fantasy” (that’s arguable in my opinion) was possible because almost all retirees were covered by a traditional pension plan.

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Life Insurance Company Ratings–Do They Matter?

Modified Endowment Contract

The last few years have certainly seen an unprecedented amount of chaos in the global financial markets. And life insurance companies have not been immune to the aftershocks. We all know that in large part, the turmoil was caused by the collapse of the derivatives market.

All of the financial unrest has lead to a much greater awareness and concern regarding life insurance company ratings, overall financial stability and how the carriers are being overseen by third party rating agencies.

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Prudential Life Insurance-the rock of Newark?

Prudential Life Insurance-the rock of Newark

Today we begin our foray into dissecting all of the different life insurance companies that are available in the market today.  Perhaps more importantly we will review their specific policies and the nuances that lurk within.

The first company we’re going to look at is Prudential life insurance and more specifically we’re going to dig into their Term Essential,Term Elite, and WorkLife 65

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Disability Insurance Is True Mortgage Protection Insurance

Disability Insurance Is True Mortgage Protection Insurance

When most people in the insurance industry bring up the topic of mortgage protection insurance, they're simply talking about buying a term life insurance policy to payoff of your mortgage in the untimely event that you die before you were planning to.

Yes, indeed there are some us who aren’t fortunate enough to be able to tell the exact date we shall make our grand exit.

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Disability Insurance for your Retirement Plan

Disability Insurance for your Retirement Plan

Contrast all the noise about your 401k with the deafening silence of financial pundits discussing how to protect your retirement plan with disability insurance.  No one can deny that we place a tremendous focus on the accumulation of retirement savings in our country.

I think we've pretty much all accepted the fact that we have to take this on as a personal responsibility and that this afternoon's Barnum & Bailey three ring circus on Capitol Hill cannot be counted on to help us out in retirement. (excuse the run-on)

Or is that just me?

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Why Pay for Individual Disability Insurance?

Why Pay for Individual Disability Insurance

One of the most common questions surrounding disability insurance is, “If I have a group disability insurance plan why would I need to buy my own disability insurance outside of my employer sponsored plan?”

Well, I'm not suggesting that you always should but I am suggesting it's something you need to weigh objectively because it's just too important not to do the investigation.

You really have nothing to lose by doing the comparisons.  After doing the research and comparisons, you'll decide one of three things:

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