Researcher and author Larry Swedroe has a definite plan when it comes to rebalancing. And he says buy-and-hold is incorrect terminology.

Larry Swedroe is a principal and director of research for St. Louis-based Buckingham Asset Management. He has authored or co-authored seven books. Before joining Buckingham in 1996, he was a senior vice president at Citicorp and vice chairman of Residential Service Corp.

On Monday, IndexUniverse.com Managing Editor Murray Coleman caught up with Swedroe to discuss the plight of bonds and buy-and-hold investing, among other issues. (It should be noted that he and another Buckingham colleague, Joe Hempen, co-authored a book on bond investing in 2006.)

IndexUniverse: Did you recently suggest a portfolio of largely municipal bonds for investors?

Swedroe: That was a reference someone took from an example I was using concerning my own portfolio. I definitely wasn’t making a recommendation for everyone to use. There is no "right" asset allocation—or

Researcher and author Larry Swedroe has a definite plan when it comes to rebalancing. And he says buy-and-hold is incorrect terminology.

Larry Swedroe is a principal and director of research for St. Louis-based Buckingham Asset Management. He has authored or co-authored seven books. Before joining Buckingham in 1996, he was a senior vice president at Citicorp and vice chairman of Residential Service Corp.

On Monday, IndexUniverse.com Managing Editor Murray Coleman caught up with Swedroe to discuss the plight of bonds and buy-and-hold investing, among other issues. (It should be noted that he and another Buckingham colleague, Joe Hempen, co-authored a book on bond investing in 2006.)

IndexUniverse: Did you recently suggest a portfolio of largely municipal bonds for investors?

Swedroe: That was a reference someone took from an example I was using concerning my own portfolio. I definitely wasn’t making a recommendation for everyone to use. There is no "right" asset allocation—or

After pointing individual investors to all-bond portfolios for 25 years, adviser and author views new research by Rob Arnott as ground-breaking. 

Stan Richelson and his wife, Hildy, run Scarsdale Investment Group Ltd. The Blue Bell, Penn.-based firm oversees about $130 million in U.S. bond portfolios for individual investors. The pair has written four books on the topic of investing in bonds. For the past 25 years, they've been advocating the case for bonds versus stocks as core holdings.

IndexUniverse.com's Murray Coleman recently caught up with Stan Richelson to discuss prospects for bonds going forward and their proper place in long-term portfolios.

IU: Did Rob Arnott's recent article in the Journal of Indexes validate work you've been doing for years?

Richelson: It was the best article I've ever read. It has not only validated our approach, but it has improved my life immensely.

IU: How so?

Richelson: When clients of ours used

A reader asked the following question about advisers using actively managed mutual funds;
(could you) discuss a little about Planners using funds that are actively managed, but really only out perform 3% or so as opposed to “real” investors that go off script. I have viewed this as a business risk v. doing what you should for your clients.
I’m not entirely sure what is being asked so I’ll just wing it. Broad based, actively managed funds are very problematic. There are of course the statistics about actively managed funds lagging the market. That seems like the sort of thing that while probably true there might be more to the story like risk adjusted returns and maybe even data mining.

From my point of view the problems arise in constructing the portfolio. If you own a bunch different funds you may still have …