Topic Guide
Welcome to the Occam Investing topic guide.
This page contains links to all articles written on the blog, as well as my ideas for future posts.
I don’t publish according to any set schedule, so if you’d like to be notified when a new post is published, you can subscribe to receive updates via email by using the link in the sidebar.
- Why should I invest? / How much can I expect to make from investing?
- Should I save or invest?
- How much do I need to start investing?
- Am I ready to invest?
- What can I invest in?
- How do I invest?
- Is now a good time to invest?
- Should I invest all at once or drip feed?
- What is diversification and why do I need it?
- The market is crashing, what should I do?
- Is dividend investing a good strategy?
- The best Vanguard equity funds
- The best Vanguard bond funds
- Should you invest in gold?
- What’s the best crash protection for your portfolio?
- Why do stocks go up?
- Is investing gambling?
- Is investing a zero-sum game?
- Beware graphs bearing outperformance
- The predictive power of fees
- How often should I rebalance my portfolio?
- When should I sell my investment?
- How much of my salary should I be investing?
Introduction
- Active vs passive – what’s in a name?
- Can anyone be truly passive? In search of the Global Market Portfolio
Active vs passive performance – the evidence
Arguments for active management
- What is factor investing?
- Valuations vs long term returns
- Risk parity
- Irrational markets
- You’re not human
Arguments for passive management
- Performance
- Active vs passive performance: The evidence
- Performance persistence
- Why do passives outperform?
- In theory: Sharpe’s Arithmetic of Active Management
- In practice: The predictive power of fees
- The market is efficient
- The market is becoming more efficient
- Positive skew
- Requires no forecasting
- Has no minimum investment requirements
- Has no capacity constraints (no style drift)
- Doesn’t require picking winning fund managers in advance (luck vs skill)
- Doesn’t require deciding whether to stick with underperforming managers, and has no temptation to chase the latest hot manager (lower behaviour gap)
- Doesn’t incur the risk of a manager having to close/suspend/merge their fund (survivorship bias)
- Has fewer conflicts of interest
- Becomes more powerful the more people adopt it
- Other benefits of passive
- Transparency
- Simplicity
- Takes less time to monitor
- Less stressful, fewer decisions required
- ‘Beating the market’ is not a financial goal
- Problems with smart beta
- Valuations and timing the market
- Closet indexing and herding
- Peer group rankings
- Self-selecting benchmarks
- The uselessness of forecasting
- Focus on things you can control
- Asset allocation drives most of your returns
Debunking the myths of passive investing
- Is passive investing causing a bubble?
- The claim: Passives are causing a bubble
- What is a passive investment?
- The evidence:
- Sharpe’s Arithmetic of Active Management
- The market share of passive investing
- Is passive investing setting prices?
- Passive investing and market crashes
- Is passive investing making the market more concentrated?
- Are large stocks getting larger?
- Where are all the outperforming active managers?
- Why passive investing is increasing market efficiency
- Summary of the series
- Actives can help you avoid crashes
- Actives outperform in less efficient markets
- Passives buy all stocks, actives buy only good stocks
- Actives give a chance of outperforming
- Active management works for bonds
- Passives don’t contribute to price discovery
- Passives don’t allocate capital efficiently or manage corporate governance
- Passives reduce dispersion and increase correlations
- The market is irrational
- ‘We are not average’
- Passives are untested in a downturn
- Passives have only done well because of QE
- Passives are un-diversified
- Index tracking is momentum investing
- The power of simplicity
- The case for stocks
- Equity – to hedge or not to hedge?
- The case for bonds
- Bonds vs bond funds
- Bonds – to hedge or not to hedge?
- Index funds vs ETFs
- Avoiding hedge funds
- Avoiding other alternatives
- Avoiding gold
- The best investing blogs
- The best investing books for beginners
- 10-year return expectations: 2020 edition
- 10-year return expectations: 2021 edition
- Smooth is what we aim for: ergodicity, the volatility tax, and not being stupid
- My 5 favourite books of 2020
- Average savings by age in the UK: Savings statistics
- How much money is in the world?
- Why do we buy expensive investments?
- Should you invest in a concentrated portfolio?
- Investor behaviour – behavioural biases and the behaviour gap
- Avoiding the news
- How does an ETF work?
- Tax efficient investing
- Understanding investment performance
- How do I choose a good passive equity fund?
- How do I choose a good passive bond fund?
- Index funds vs ETFs
- Individual bonds vs bond funds
- A diversifier or a hedge? Understanding bond funds
- Should I invest in the market or a BTL property?
- Should I rent or buy?
- Interest rate effects on stocks/bonds
- Do I need a financial adviser?
- Investing tips
- Sequence of returns risk
- Your returns depend on when you’re born – as do your perceptions of risk. Focus on what you can control.
- The uselessness of peer group benchmarks
- Why there will always be bubbles and crashes
- Avoiding fads/The danger of speculation – how losses are disproportionately bad
- ESG
- Investment consultants