Diversified Digest: October 9

October 9th, 2017 | posted in: Investing

by: R. Samuel Fraundorf

Diversified Trust’s investment team brings you headlines of note for the week. Click on the links to access the articles we found of interest

We continue to be entertained by the arguments both for and against passive investing (read “ETF”).  Talk of the world coming to end at the hands of passive investors seems a little overblown to us.  In reality, less than one in five shares is held in an index investment, according to Blackrock, and while there will continue to be good reasons, from taxes to low cost, to utilize passive investments in our portfolios, they are not the “only and best” answer for a number of reasons.

Bringing an even deeper insight into the word “frenemy”, we enjoyed this article about the multi-billion dollar battle over patented technology and an $18 dollar component that makes your smartphone the live-without device it is.

If you had significant cash on your balance sheet, just sitting there earning next to nothing, you wouldn’t think about going into the debt markets to raise additional capital, would you?  You would if you couldn’t access that cash without paying a significant income tax because it is currently off-shore.

The Wall Street Journal reported last week than another thing Amazon is changing is the recruiting effort to attract the best and brightest M.B.A.’s coming out of business schools.  But as some really smart business folks pointed out with the Harvard M.B.A. Indicator, an easy way to see the next bubble is to watch where those Harvard grads are going and stay away from that in your portfolio.

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