There are an almost infinite number of ways to succeed at investing. If success is ending up with a portfolio large enough to meet your investing goals, whether that be early retirement, putting children through university, supporting family members, or leaving a legacy, there are countless ways to get there. You can, over time, create …
We’re in a weird period for bonds right now. Interest rates are at all-time lows, bond yields are at all-time lows, and it’s looking more and more likely we may have to deal with a positive stock/bond correlation at some point soon. So should we still be investing in them? The purpose of bonds is …
Updated 9th June 2021 Since my list of the best investing books for beginners was first published last year, I’ve moved another dozen or so investing books to the ‘read’ section of my bookshelves. But only one of those made it into my top 5, and it’s gone straight to number 1. While these are …
About a dozen or so friends from school and I have a WhatsApp groupchat which has now been running for over 10 years. It started as a way for us all to keep in contact as we started university, and has carried on ever since. I was trawling through the hundreds of unread messages on …
As a UK investor myself, I struggle to find useful analysis aimed at sterling investors at the best of times. Almost all of it is US-centric, and this is especially true when it comes to gold. The purpose of this article, then, is to examine gold from a UK perspective, and answer the question of …
A few years ago, one of my friends asked me to meet with his father to discuss his portfolio. He’d been managing his own portfolio for the last 20 years or so, and wanted some advice. He’s kindly agreed to me sharing his story for this article, but for the sake of privacy I’ve changed …
If you’re an investor based in the UK, you’ve probably heard of Vanguard. They’re a hugely popular fund manager, and offer a slew of attractively priced, predominantly passive, funds for investors to choose from on their platform. But with so much choice comes some tricky decisions. Which fund, or funds, should you choose? What are …
The best Vanguard index tracker funds for UK investors Read More »
I work as an investment manager, and a few years ago I had a boss called James (not his real name). His job was mainly portfolio construction, but he occasionally took client meetings and provided portfolio updates to some high net-worth individuals alongside the relationship managers. He had a vast repertoire of favourite sayings that …
So this is it. It’s times like these which separate the successful investors from the mediocre. The decisions you make now will be some of the most important in your investing career. These are the times when you decide what your lifetime investment returns will look like. Decisions made in times of crisis are orders …
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 »
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 »
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 »
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 …
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 …
GT Advanced Technologies was a sure thing. It was supposed to be the primary supplier of sapphire glass to Apple, which was going to be used on the new iPhone 6 and iPhone 6 Plus. It had hundreds of millions of cash in the bank at the last quarterly filing, a strong history of earnings …
Reasons for why we need to diversify can be found in the most unlikely of places. The Battle of Stalingrad, with an anecdote courtesy of Morgan Housel, provides an excellent example. In late 1942, during the Battle of Stalingrad, a German tank unit sat in reserve on grasslands outside the city. These tanks were desperately …
Most of us at some point during our lives are faced with the decision of how to invest a cash lump sum. We can end up with a lump sum as a result of all sorts of situations, either through years of savings, receiving a bonus, the sale of a house, an inheritance, a pension …
If you’ve ever asked your investment manager about whether you should stay in cash or get invested, you’ll likely have been presented with some variation of the following chart: Source: JP Morgan The chart is from the excellent JP Morgan Guide to the Markets, but almost all managers have some variation in their marketing decks. …
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 …
It’s one of the most worrying things that goes through your head before investing. As you start to think about putting your cash in the market, you start paying more attention to the news headlines. They might be relevant to you now, after all. And as you read the news, the scary headlines start to …
“The market looks too expensive at the moment. I think it’s due a correction, so I’m just going to wait for a bit of a dip before I get invested.” It sounds like a sensible strategy. “What goes up must come down” feels relevant, and the power of mean reversion seems like it should bring …
The market looks expensive. Should I wait for a selloff before investing? Read More »
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 »
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 …
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 …
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 …
