Allan Roth is the founder of Wealth Logic, an hourly-based financial planning firm in Colorado Springs, Colo. He has taught investing and finance at universities and written for Money Magazine, The Wall Street Journal and others. His contributions aren't meant to convey specific investment advice.

The Stock Market Plunge: What You Should Do, or Not Do

The headlines are brutal: Wall Street’s Rout Market Meltdown Global Financial Markets Going Crazy It’s enough to get anyone to panic and sell. And that, in my opinion, would be the exact wrong thing to do. It’s not that I have a clue whether the current market plunge is a minor setback for stocks or the beginning of the third half-off sale this century. Rather, I know that it’s our fair weather human nature to embrace risk in boom markets …

Stocks for the Long Run? Really?

Most of us have heard that stocks have outperformed bonds in the long run. But what is the definition of long run? So far this century, have stocks really outperformed? To answer that question, I decided to look at how three different asset classes have performed in the new millennium. I examined the performance of stocks vs. bonds from Dec. 31, 1999 through June 30, 2015. I compared the total returns of U.S. stocks, international stocks and investment grade U.S. …

When to Sell an Investment

I’m often asked when the right time is to sell an investment. There are actually two answers — a logical one and an emotional one. Let me explain by illustrating through one of the lessons in a course I teach. I teach behavioral finance to CPAs (and confess I am one). I give the class the following situation and then poll them on what they would do: You have been gifted $10,000 and decide to buy two stocks with it. …

Gold Investing — Learning the Hard Way

Gold is now down 43 percent since its peak in 2011. If you think that’s bad, gold-mining stocks are down more than 70 percent in the past five years. As tends to happen, people have been dumping gold. Many owned gold in the form of an exchange traded fund (ETF) called SPDR Gold Shares (GLD), which was the largest ETF on the planet back in 2011. As also tends to happen, investors bought the fund as it went up only …

How to Beat the S&P 500 Index

I’m going to try to mislead you, but it’s for a very good reason. What I have for you is a U.S. stock fund that not only has beaten the S&P 500 index, it’s nearly certain to continue doing so in the long run. For now, I’m going to call this mutual fund the Super-Secret Fund, or SSF for short. Looking back over 20 years, you can see that the SSF trounced the S&P 500 index. Not only did it …

What the End of the World Teaches Us About Investing

There have been many predictions of Armageddon throughout human history and, so far, all have been a bit exaggerated. Sometimes several apocalyptic false alarms come from the same person, such as Pastor Charles Taze Russell, who predicted the end of the world in 1914, based on careful calculations. When the world didn’t end, he updated his calculations, according to the book History’s Worst Predictions (Chartwell Books, 2011), predicting it would end in 1915, 1918, 1920, 1925, 1941, 1975 and 1994. …