Investing

International diversification: The evidence – Part 3

If you cast your mind back to this post (Against International Diversification), we saw some legitimate, evidence-based reasons which might support not diversifying internationally. Specifically, we saw that cross-country correlations are high, and that correlations are likely to converge to 1 during a crash. But are these arguments good enough to justify heavily overweighting our …

International diversification: The evidence – Part 3 Read More »

Return expectations – 2020 edition

How much can a UK-based investor expect to make on their investments over the next 10 years? To help answer the question, I’ve collated 10-year equity return forecasts from as many different (reliable) sources as I could find – 13 in total. As with most things investing-related, the data was heavily US-biased and almost always …

Return expectations – 2020 edition Read More »

International diversification: The evidence – Part 2

In the previous post we saw that international diversification: Helps ensure one country’s drawdowns don’t affect your overall portfolio’s returns too much, Reduces risk through lower volatility, drawdowns, and vulnerability to Black Swans, Increases returns through minimising the volatility tax and owning the few countries which are driving returns. But that’s not all… Diversification reduces …

International diversification: The evidence – Part 2 Read More »

International diversification: The evidence – Part 1

We owe a lot to the ancient Greeks. They laid the groundwork for a huge swathe of today’s society, including democratic government, philosophy, theatre, architecture, mathematics, jury-based trials, medicine, and the Olympics. But there’s one aspect of Greek culture which hasn’t managed to endure the test of time – its stock market. The Greek stock …

International diversification: The evidence – Part 1 Read More »

Against international diversification

Given that I’m writing this the day after the UK left the European Union, a post on the perils of investing overseas seems appropriate. What better way to stick it to those straight-banana loving mainlanders than to take all our investments and move them back to our glorious island? Thankfully I won’t be opining on …

Against international diversification Read More »

How diversified is the FTSE 100?

I recently attended a small presentation given by the CIO of one of Oxbridge’s college endowments. He was a typical economist – articulate and confident in his views, with some big-brand names on his CV and a reassuringly expensive suit (he must know what he’s talking about). In typical economist style, he also threw out …

How diversified is the FTSE 100? Read More »

Cash cocaine

Holding cash can be incredibly addictive. It’s safe and understandable, whereas the markets are volatile and unknown. On paper we know that markets rise on average 3 out of every 4 years, and if left alone, investments can compound into serious wealth. But when you receive a cash lump sum and are considering whether or …

Cash cocaine Read More »

I’m worried about [insert major geopolitical event]. Should I wait before investing?

It’s always easy to find a reason not to invest. Because of the huge number of factors that can affect markets, combined with the never-ending cycle of major news stories, there’s always an event that could cause markets to fall. But despite this, the market’s risen in about 3 of every 4 years for as …

I’m worried about [insert major geopolitical event]. Should I wait before investing? Read More »

Is now a good time to invest?

By now you should be more comfortable with the reasons for investing, the importance of saving and investing, the amount you’d need to start investing, whether you’re ready to invest, what you can invest in, and how you can actually invest. But is now a good time to invest? To properly answer the question, I’ve …

Is now a good time to invest? Read More »

Should I save or invest?

If someone asked you which was more important: the amount you invest each month, or the rate of return on your investments – what would you say? In my experience, most people tend to say their returns. And that’s understandable given how much time investors devote to eking out a few extra basis points of …

Should I save or invest? Read More »

How do I invest?

Depending on how keen you are on getting stuck into portfolio construction, the difficulty of building your own portfolio can range anywhere from, “So easy, I literally don’t have to do anything” to, “This is impossible, I can’t believe I have to do all this myself – I don’t even know where to start”. The …

How do I invest? Read More »

What can I invest in?

Another one of the questions I’m often asked about investing is, “What can I invest in? Like, what’s it even possible for me to buy?” It’s surprising to find that many people (or maybe just the people I know), don’t know what they’re able to invest in. A good place to start when answering this …

What can I invest in? Read More »

Am I ready to invest?

In contrast to the “How much do I need to start investing?” question, the “Am I ready to invest?” question is one I don’t get asked as often as I should do. To preface this post, I should note that I’m not a financial advisor (I’m an investment manager) and you shouldn’t be taking this …

Am I ready to invest? Read More »

How much do I need to start investing?

This is probably the question I get asked more than any other. There seems to be a perception (especially amongst younger people) that investing is only for well-off people in their 40s or 50s, who have their own dedicated and reassuringly expensive investment manager who wouldn’t take your cash unless you had 6 figures to …

How much do I need to start investing? Read More »