The Informed Investor

Episode 30: If a traditional investment portfolio with 60% stocks and 40% bonds has a down year, should you abandon this approach?

Plenty of investors were probably asking that question in 2022, when the Russell 3000 Index plunged 19.2% and the Bloomberg US Aggregate Bond Index tumbled 13.0%. (Frank Russell Company is the source and owner of the trademarks, service marks, and copyrights related to the Russell Indexes; Bloomberg data from Bloomberg.)

Relying on a balanced portfolio for reasonable returns and reduced risk didn't work.

But 2022 was the quintessential outlier—a data point that lies outside the mainstream in a particular dataset.

History shows that 2022 was the only year from 1979 through 2025 that both US stocks and US bonds posted negative returns.

All told, US bonds suffered five down years and US stocks eight in that 47-year period. The rest of the time they delivered gains.

The blend of stocks and bonds that's right for you—60/40, 80/20, 30/70, etc.—will depend on your goals and your time horizon, and it might change over time.

However, we believe critics of the traditional 60/40 mix are arguably misguided if they think it's no longer relevant, particularly as a tool for mitigating risk.

To wit: From 1986 through 2025, the amount of volatility reduction investors gained from adding 40% bonds to their portfolio was stable through time even though the correlation between stocks and bonds varied widely.

In Episode 30 of The Informed Investor, Dimensional's Mark Gochnour, Head of Global Client Services, Wes Crill, PhD, Senior Client Solutions Director, and Jake DeKinder, Head of Client Communications, consider the arguments for and against the 60/40 portfolio and explain why popular alternatives may not get investors where they want to go.

Past performance is not a guarantee of future results. Indices are not available for direct investment; therefore, their performance does not reflect the expenses associated with the management of an actual portfolio.

Risks include loss of principal and fluctuating value. Diversification does not eliminate the risk of market loss.

LINKS FROM TODAY'S EPISODE:

The Informed Investor Feedback Survey https://www.dimensional.com/us-en/informed-investor-survey

The Informed Investor, Episode 26, "Will You Be OK If Stocks Stumble?" https://www.youtube.com/watch?v=5E6POt0MQgM&list=PLCyJr6FFig-h1mA7rVP7Mbk0irFw2wA90&index=4&pp=iAQB

The Informed Investor, Episode 9, "How Do You Protect Against Market Drops?" https://www.youtube.com/watch?v=7A3f2LE1DQg&list=PLCyJr6FFig-h1mA7rVP7Mbk0irFw2wA90&index=22&pp=iAQB

The Informed Investor on YouTube https://www.youtube.com/playlist?list=PLCyJr6FFig-h1mA7rVP7Mbk0irFw2wA90

Dimensional Fund Advisors Shorts on YouTube https://www.youtube.com/@dimensionalfundadvisors/shorts

Mark Gochnour on LinkedIn https://www.linkedin.com/in/mark-gochnour-9a23598a/

Wes Crill on LinkedIn https://www.linkedin.com/in/wes-crill-77a49417/

Jake DeKinder on LinkedIn https://www.linkedin.com/in/jake-d-4105b98/

Learn more at https://www.dimensional.com/

Episode 29: What really drives the outcome of your investment portfolio—market performance or your own behavior?

Investors often view returns as a purely quantitative result of markets, risk, timing, or expertise. Yet psychology tells a different story.

Emotions and behavioral biases quietly shape decisions, frequently pushing investors away from their long-term goals.

Any number of common biases can show up again and again in real life. For example, hindsight bias makes unpredictable events feel obvious after the fact, while the illusion of control leads investors to overestimate their ability to influence outcomes.

Pattern-seeking behavior can cause people to see meaning in random data, and beliefs about reversion to the mean may encourage premature or poorly timed decisions.

Others include confirmation bias and attribution bias (crediting skill for success but blaming markets for failure).

The discussion goes further, examining deeper categories of bias. Encapsulated biases are emotionally driven and resistant to logic, while attentional biases cause investors to overlook critical information.

Then there is the GI Joe fallacy—the false belief that simply knowing about biases is enough to overcome them.

In Episode 29 of The Informed Investor, Dimensional's Mark Gochnour, Head of Global Client Services, Scott Bosworth, Head of the Speakers Bureau, and Jake DeKinder, Head of Client Communications, dive into behavioral finance—the study of how psychology impacts investor behavior—to explore how our emotions influence portfolio outcomes. Through academic research and real-world examples, they compare the narratives of disciplined investors and short-term speculators, offering a framework for bridging human behavior with market efficiency.

LINKS FROM TODAY'S EPISODE:

The Informed Investor: Feedback Survey

https://www.dimensional.com/us-en/informed-investor-survey

"The Informed Investor" on YouTube [update with live link]

Dimensional Fund Advisors Shorts on YouTube https://www.youtube.com/@dimensionalfundadvisors/shorts

Mark Gochnour on LinkedIn https://www.linkedin.com/in/mark-gochnour-9a23598a/

Jake DeKinder on LinkedIn https://www.linkedin.com/in/jake-d-4105b98/

Scott Bosworth on LinkedIn https://www.linkedin.com/in/sbosworth/

Learn more at https://www.dimensional.com/

Episode 28: Many stock market pundits are forecasting rewarding returns in 2026. Should you act on their predictions?

On the other hand, should you get out of the market based on doom-and-gloom warnings about the US economy?

It's tempting to think someone out there has a crystal ball. But it may be more worthwhile to consider the point of predictions.

Forecasts for the stock market and the economy get people talking. Headline writers in the media are looking to stir up interest. They often exaggerate the apparent likelihood of a greed- or fear-inducing outcome.

Accordingly, you can find a prediction for almost any outcome, good or bad.

Some headlines claim the US stock market will keep rallying after three straight years of double-digit gains. Others argue a bear market is just around the corner.

Bitcoin will hit $250,000 this year, screams a recent headline. But then there's one insisting the most popular cryptocurrency will collapse to $10,000.

Still another headline claims the job market will suffer from "uncomfortably slow growth" in the first half before rebounding later in the year. Talk about hedging bets.

The point is that predictions for 2026 (and every year) are all over the map. That doesn't mean they'll be wrong, but there simply is no way to know which ones will be right.

In Episode 28 of The Informed Investor, Dimensional's Mark Gochnour, Head of Global Client Services, Wes Crill, PhD, Senior Client Solutions Director, and Jake DeKinder, Head of Client Communications, dig into the headlines predicting how the market and economy will perform this year and try to suss out what, if anything, investors can learn from the prognosticators.

LINKS FROM TODAY'S EPISODE:

The Informed Investor Feedback Survey https://www.dimensional.com/us-en/informed-investor-survey

The Informed Investor, Episode 11, "Do Private Markets Deliver an Edge?" https://www.youtube.com/watch?v=TUGb1LLeB1A&list=PLCyJr6FFig-h1mA7rVP7Mbk0irFw2wA90&index=18&pp=iAQB

The Informed Investor on YouTube https://www.youtube.com/playlist?list=PLCyJr6FFig-h1mA7rVP7Mbk0irFw2wA90

Dimensional Fund Advisors Shorts on YouTube https://www.youtube.com/@dimensionalfundadvisors/shorts

Mark Gochnour on LinkedIn https://www.linkedin.com/in/mark-gochnour-9a23598a/

Wes Crill on LinkedIn https://www.linkedin.com/in/wes-crill-77a49417/

Jake DeKinder on LinkedIn https://www.linkedin.com/in/jake-dekinder-cfa-4105b98/

Learn more at https://www.dimensional.com/

Episode 27: Do small capitalization stocks typically outperform in January? If so, can investors capitalize on that pattern?

This trend is known as the January Effect. It's a popular idea because historical data show a sizable small cap premium versus large caps in January.

Still, that's not a reason to avoid small cap stocks in other months, assuming you want to own them. Why not?

Two reasons: (1) Nobody really knows why this "January Effect" exists—or whether it will continue, and (2) small caps, in general, have higher expected returns.

Welcome to the wild world of odd stock market indicators, few of which seem to offer sensible investing signals.

Another popular one is the Super Bowl Indicator: The winner of the Super Bowl supposedly determines how the stock market will perform that year.

Silly idea, obviously, because this widely followed signal suggests that the market will deliver a positive return only in years when the NFC champion wins.

There isn't any academic or logical explanation for this indicator. But since the correlation between the Super Bowl winner/loser and market returns appeared to be perfectly accurate when the indicator was first identified in the late 1970s, people started believing it.

They probably should stop believing. In the 21st century, the indicator's success rate is 38%.

Technical analysts also look for signals in data like moving averages, often referencing something called a "Golden Cross" or a "Death Cross" in a stock index. The former is when the 50-day moving average crosses above the 200-day moving average; the latter is the opposite.

(A moving average is a constantly updated average price or level.)

The S&P 500 experienced both a golden cross and a death cross in 2025. Which signal, if any, was right?

The same question applies to all of these strange indicators … and others like men's underwear purchases, hemline lengths, and even sunspots.

In Episode 27 of The Informed Investor, Dimensional's Mark Gochnour, Head of Global Client Services, Wes Crill, PhD, Senior Client Solutions Director, and Jake DeKinder, Head of Client Communications, scrutinize the data and try to determine whether investors can benefit from any of these so-called signals.

LINKS FROM TODAY'S EPISODE:

The Informed Investor: Feedback Survey

https://www.dimensional.com/us-en/informed-investor-survey

The Informed Investor, Episode 3

"Debts, Deficits, and Investing"

https://youtu.be/AK66PrRFBTU?si=W5gJ-thCErETX7kV

The Informed Investor on YouTube https://www.youtube.com/playlist?list=PLCyJr6FFig-h1mA7rVP7Mbk0irFw2wA90

Dimensional Fund Advisors Shorts on YouTube https://www.youtube.com/@dimensionalfundadvisors/shorts

Mark Gochnour on LinkedIn https://www.linkedin.com/in/mark-gochnour-9a23598a/

Wes Crill on LinkedIn https://www.linkedin.com/in/wes-crill-77a49417/

Jake DeKinder on LinkedIn https://www.linkedin.com/in/jake-dekinder-cfa-4105b98/

Learn more at https://www.dimensional.com/

Episode 26: Can anyone accurately predict when the stock market will hit a rough patch?

Not likely.

Although the market's long-term annualized return sits just above 10% and good years are more common than bad years, unexpected outcomes are not unusual.

Which means holding a portfolio suitable for all market environments probably makes sense for most investors—as does conducting an investing "fire drill" to determine whether your portfolio is prepared for the unexpected.

The 2000–2009 period, often termed the "lost decade," offers a helpful reminder. The annualized return for the S&P 500 was –0.9%. But in 2000 did anyone expect they would lose money over the next 10 years, especially after the index gained an annualized +18.2% in the previous 10 years?

Again, not likely.

Non-US stocks see similarly unexpected outcomes.

During that lost decade in the US, the MSCI All-Country World ex USA index, a widely followed international stock index, gained an annualized +2.7%.

Then there's Japan, where the stock market peaked in 1989 and proceeded to go nowhere for the next 28+ years.

More recent evidence confirms that investors should expect the unexpected.

In 2021, 2023, and 2024, the S&P 500 Index gained more than +25% each year. Through late December of 2025, its year-to-date return was north of +18%. But in 2022 the index lost –18.1%. Note that none of those returns is close to the long-term average.

The fact is that stocks often deliver surprising results. Bonds do too. Another example: From 2000 to 2020, the annualized return for the S&P 500 was +6.6%, far below its long-term average. Meanwhile, the Bloomberg U.S. Government Bond Index Long gained +7.8%, higher than its long-term average.

In Episode 26 of The Informed Investor, Dimensional's Mark Gochnour, Head of Global Client Services, Wes Crill, PhD, Senior Client Solutions Director, and Jake DeKinder, Head of Client Communications, examine the high volume of surprises that come with investing and explain why investors should set their expectations accordingly.

LINKS FROM TODAY'S EPISODE:

The Informed Investor: Feedback Survey https://www.dimensional.com/us-en/informed-investor-survey

"The Informed Investor" on YouTube https://www.youtube.com/playlist?list=PLCyJr6FFig-h1mA7rVP7Mbk0irFw2wA90

Dimensional Fund Advisors Shorts on YouTube https://www.youtube.com/@dimensionalfundadvisors/shorts

Mark Gochnour on LinkedIn https://www.linkedin.com/in/mark-gochnour-9a23598a/

Wes Crill on LinkedIn https://www.linkedin.com/in/wes-crill-77a49417/

Jake DeKinder on LinkedIn https://www.linkedin.com/in/jake-dekinder-cfa-4105b98/

Learn more at https://www.dimensional.com/

Sources: S&P data © 2025 S&P Dow Jones Indices LLC, a division of S&P Global. All rights reserved; MSCI data © MSCI 2025, all rights reserved; Bloomberg data from Bloomberg.

Past performance is not a guarantee of future results. Indices are not available for direct investment; therefore, their performance does not reflect the expenses associated with the management of an actual portfolio.

Episode 25: At the end of every calendar year, stock market pundits publish predictions for the coming 12 months. Should you pay attention to these forecasts?

A look back at predictions for 2025 may help you decide.

Some market pros argued that international stocks would struggle due to tensions around global trade and tariff policies. But that's not what happened.

From January through the end of November, non-US stocks were performing far better than US stocks based on index returns.

Similarly, many countries pegged as potential victims in a trade war—like Canada and Mexico—were outgaining the US market through the end of November.

What about specific predictions for the US market—did they prove prescient in 2025? Not exactly. Ditto for the four years leading up to 2025.

Many predictions weren't close, as realized gains mostly ran far ahead of the forecasts.

At least one category did see accurate predictions: gold. Soothsayers in late 2024 went all in on a gold rally—and the coveted metal soared past $4,000 through November after starting the year just above $2,600.

But similar predictions for a bitcoin boom didn't work out; the widely followed cryptocurrency was hit with big losses late in the year.

In Episode 25 of the "The Informed Investor" podcast, Dimensional's Mark Gochnour, Head of Global Client Services, Wes Crill, PhD, Senior Client Solutions Director, and Jake DeKinder, Head of Client Communications, conduct an investment autopsy on 2025 predictions and offer some insights on why accurate forecasts were hard to come by.

LINKS FROM TODAY'S EPISODE:

"The Informed Investor" on YouTube https://www.youtube.com/playlist?list=PLCyJr6FFig-h1mA7rVP7Mbk0irFw2wA90

Dimensional Fund Advisors Shorts on YouTube https://www.youtube.com/@dimensionalfundadvisors/shorts

Mark Gochnour on LinkedIn https://www.linkedin.com/in/mark-gochnour-9a23598a/

Wes Crill on LinkedIn https://www.linkedin.com/in/wes-crill-77a49417/

Jake DeKinder on LinkedIn https://www.linkedin.com/in/jake-dekinder-cfa-4105b98/

Learn more at https://www.dimensional.com/

Episode 24: Why do the majority of ETF and mutual fund managers fail to outperform their benchmarks?

The reasons are numerous but not always clear.

As a result, many investors might believe they own winning funds that will continue to beat their benchmarks or the market at large. But they might be wrong, on both counts.

Other investors might be painfully aware that their funds are underperforming but unsure what to do about it.

Every year Dimensional analyzes returns (https://www.dimensional.com/us-en/insights/the-fund-landscape) from a large sample of US-domiciled exchange-traded funds and mutual funds. Our objective is to assess the performance of fund managers relative to benchmarks.

Based on data through 2024, the evidence shows that a majority of fund managers in the sample failed to deliver benchmark-beating returns after costs. Published costs include fund expense ratios, and the data show that funds with lower expense ratios tend to perform better than those with higher expense ratios.

The same is true for funds with lower vs. higher turnover, a measure of how often holdings are bought and sold.

But this data doesn't mean investors should just own the funds with the lowest expense ratios and lowest turnover.

This approach might steer you toward index funds, which attempt to track the performance of their underlying indices in a rigid way. But one consequence is that such funds aren't necessarily focused on stocks with higher expected returns.

On the other end of the spectrum, some investors might think that paying up for a supersmart fund manager will ensure outsize returns. But the data don't support that approach either; fund managers who outperform over periods of five years tend to underperform in the next five years.

In Episode 24 of the "The Informed Investor" podcast, Dimensional's Mark Gochnour, Head of Global Client Services, Wes Crill, PhD, Senior Client Solutions Director, and Jake DeKinder, Head of Client Communications, analyze the complexities of the fund landscape to help investors assess their fund managers and determine whether their funds are getting the job done right.

LINKS FROM TODAY'S EPISODE:

The Fund Landscape

https://www.dimensional.com/us-en/insights/the-fund-landscape

"The Informed Investor" on YouTube https://www.youtube.com/playlist?list=PLCyJr6FFig-h1mA7rVP7Mbk0irFw2wA90

Dimensional Fund Advisors Shorts on YouTube https://www.youtube.com/@dimensionalfundadvisors/shorts

Mark Gochnour on LinkedIn https://www.linkedin.com/in/mark-gochnour-9a23598a/

Wes Crill on LinkedIn https://www.linkedin.com/in/wes-crill-77a49417/

Jake DeKinder on LinkedIn https://www.linkedin.com/in/jake-dekinder-cfa-4105b98/

Learn more at https://www.dimensional.com/

Episode 23: Are there any connections between betting on sports and investing in stocks?

Obviously, investing is not the same as placing a bet on your favorite team. For most people, after all, investing is usually a long-term endeavor.

But you might be surprised to learn how the betting lines that drive wagering in sports are not unlike prices set by buyers and sellers in securities markets.

Point spreads set by sportsbooks are largely based on all available information about the teams competing in upcoming games and the athletes who are expected to play.

Similarly, research shows that stock prices in public markets are largely based on all available information about publicly traded companies as well as economic metrics and geopolitical trends.

The outcome of any upcoming game is always in doubt because the game hasn't been played. Likewise, the future price of a stock is never known in advance.

However, betting lines and market prices typically offer reasonable estimates of fair value.

What does that mean, exactly? It means lines and prices are set at levels that will attract bettors and investors, respectively, regardless of their beliefs about the future.

Then, when new information becomes available, those lines and prices frequently change so that bettors and investors will keep coming back.

In this sense, markets are always working, whether it's a betting market or a securities market.

In Episode 23 of the "The Informed Investor" podcast, Dimensional's Mark Gochnour, Head of Global Client Services, Wes Crill, PhD, Senior Client Solutions Director, and Jake DeKinder, Head of Client Communications, suit up and "show out" for a revealing discussion on sports betting and markets.

LINKS FROM TODAY'S EPISODE:

The "Grumpy Economist" on Growth, Tariffs, and the Fed WITH JOHN COCHRANE https://www.youtube.com/watch?v=KrOnqG0t-z4

"The Informed Investor" on YouTube https://www.youtube.com/playlist?list=PLCyJr6FFig-h1mA7rVP7Mbk0irFw2wA90

Dimensional Fund Advisors Shorts on YouTube https://www.youtube.com/@dimensionalfundadvisors/shorts

Mark Gochnour on LinkedIn https://www.linkedin.com/in/mark-gochnour-9a23598a/

Wes Crill on LinkedIn https://www.linkedin.com/in/wes-crill-77a49417/

Jake DeKinder on LinkedIn https://www.linkedin.com/in/jake-dekinder-cfa-4105b98/

Learn more at https://www.dimensional.com/

Episode 22: Regardless of which way the market is moving, do you feel thankful as an investor?

That's easy when the market is rising, but it may be challenging if stock prices are falling. Worrying about your portfolio can be unnerving.

At Dimensional, we hope everyone can have a rewarding investment experience. But our view is that great returns aren't the only thing worth celebrating.

We're thankful for the power of markets, for example.

In 2025, most i­­nvestors can easily build a globally diversified, low-cost, transparent portfolio and then potentially benefit from what the capital markets deliver.

They can also obtain reliable, fairly priced financial advice from investment professionals all around the country.

And they can count on numerous investor protections built into the system at all levels.

In Episode 22 of the "The Informed Investor" podcast, Dimensional's Mark Gochnour, Head of Global Client Services, and Jake DeKinder, Head of Client Communications, offer nine reasons why all investors can be thankful during the holiday season.

LINKS FROM TODAY'S EPISODE:

"The Informed Investor" on YouTube https://www.youtube.com/playlist?list=PLCyJr6FFig-h1mA7rVP7Mbk0irFw2wA90

Dimensional Fund Advisors Shorts on YouTube https://www.youtube.com/@dimensionalfundadvisors/shorts

Mark Gochnour on LinkedIn https://www.linkedin.com/in/mark-gochnour-9a23598a/

Jake DeKinder on LinkedIn https://www.linkedin.com/in/jake-dekinder-cfa-4105b98/

Learn more at https://www.dimensional.com/

Episode 21: What are the essential money moves for people over 50?

By this point, many are beginning to prepare for retirement.

Some may have built up significant wealth and gotten used to spending it after hitting their peak earning years.

Others may be focused on preserving their wealth but feel unsure about whether they'll have enough for the decades ahead.

"Lifestyle creep"—getting accustomed to spending on second homes, boats, vacations, entertainment, and more—may be a source of concern as you get closer to retirement.

Planning for the future also means thinking about an estate plan, wills, trusts, and health care.

Estimating how much money you'll spend in retirement, after you stop working and earning a paycheck, is an important task. If you've purchased a second home, maintenance costs can be significant.

If aging parents are in the picture, now may be the time to address their financial circumstances and health-care needs.

Once people hit retirement, how they spend their time becomes a puzzling question for many.

Continuing to work but at a slower pace may be an option that ensures a comfortable transition. Carefully preparing for this stage of your career can be beneficial.

Tax planning also rises in importance as you go from the accumulation to the decumulation phase with your savings.

Thinking about your legacy—gifting to children or focusing on philanthropy—is another topic to consider carefully.

In Episode 21 of the "The Informed Investor" podcast, Dimensional's Mark Gochnour, Head of Global Client Services, welcomes Tim Slattery, PhD, Chief Investment Officer of Heritage Investment Group, and Mike Mers, Founder of Aspen Capital Management, to talk wealth, health, and financial planning for people 50 and up.

Next week, tune in for a special episode of "The Informed Investor" podcast as Dimensional's Mark Gochnour and Jake DeKinder, Head of Client Communications, discuss the many reasons why investors can be thankful during the holiday season.

LINKS FROM TODAY'S EPISODE:

"The Informed Investor" on YouTube https://www.youtube.com/playlist?list=PLCyJr6FFig-h1mA7rVP7Mbk0irFw2wA90

Dimensional Fund Advisors Shorts on YouTube https://www.youtube.com/@dimensionalfundadvisors/shorts

Tim Slattery https://heritageinvestment.com/our-professionals/timothy-g-slattery/

Mike Mers https://www.aspencapitalmgmt.com/mike-mers

Mark Gochnour on LinkedIn https://www.linkedin.com/in/mark-gochnour-9a23598a/

Jake DeKinder on LinkedIn https://www.linkedin.com/in/jake-dekinder-cfa-4105b98/

UPCOMING WEBCAST

Fast Takes on a Fast Market:

Your 2025 Market Q&A

The 2025 market has been anything but quiet. From shifting rate expectations and tariff talk to the latest moves in gold and digital assets, investors have had plenty to process and even more to ask about. Join Dimensional's Courtney Scott, Jake DeKinder, and Apollo Lupescu for a fast-paced webcast that cuts through the noise and examines what's currently driving investor questions and market sentiment.

Tuesday, December 9, 2025, at 1 pm CT

REGISTER NOW: https://event.webcasts.com/starthere.jsp?ei=1742855&tp_key=0ddcbb9c03&sti=apple

Learn more at https://www.dimensional.com/