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Best of the AAII Journal

My favorite articles are listed below. In hand-picking the commentaries for this list, I sought out a mix of articles that covered various aspects of investing strategies and portfolio management.

Beginning Investor

Determining How Much to Allocate to Each Investment

- by Charles Rotblut, CFA

Allocate by the percentage of portfolio dollars, not by the number of shares.
 

BEHAVIORAL FINANCE

The Case for Systematic Decision-Making

- by Wesley R. Gray, Ph.D.

Though human expertise is needed to design models, models perform better than humans because they aren’t subject to behavioral biases.
 

BONDS

Defined-Maturity Funds: A Bond Alternative With Compromises

- by Charles Rotblut, CFA

Simple actions you can take now to focus on the things you can control and avoid making common investment mistakes.
 

FINANCIAL PLANNING

Social Security Strategies for Couples

- by William Reichenstein and William Meyer

By understanding the complexities and making smart claiming decisions, couples can add more to their lifetime benefits than singles can.
 

FINANCIAL STATEMENTS

Introduction to Stock Valuation: The Price-Earnings Ratio

- by Joe Lan, CFA

A close look at the most widely used valuation measure, and an explanation of how relative price-earnings ratios can provide more insight as to whether a stock is mispriced.
 

FIRST CUT

Combining Value and Momentum

- by John Bajkowski

Low relative valuation ratios are combined with momentum indicators to find potential winning stocks.
 

MUTUAL FUNDS & EXCHANGE-TRADED FUNDS

The Top Mutual Funds Over Five Years: Credit the Bull and the Calendar

- by Charles Rotblut, CFA

Domestic stock and sector funds lead the top performers as a bull market and a calendar shift boosted their five-year returns.
 

PORTFOLIO STRATEGIES

Reduce Stock Exposure in Retirement, or Gradually Increase It?

- by Michael Kitces and Wade Pfau

Starting retirement with a 30% allocation to equities and then gradually increasing it to 70% leads to a 95.1% probability of not outliving your savings.
 

STOCK SCREENS

2013 Stock Screens Review: The Year of the Bulls

- by Joe Lan, CFA

More than 40 of the 65 screens tracked on AAII.com beat the S&P 500 last year. Plus, two new risk measures are presented.
 

STOCK STRATEGIES

Exploiting the Relative Outperformance of Small-Cap Stocks

- by John Davenport and Fred Meissner

Small-cap stocks outperform large-cap stocks during periods of economic expansion and can deliver excess returns when a sector rotation strategy is used.