Diversification is Not a Free Lunch Nobel laureate Harry Markowitz reportedly said that “diversification is the only free lunch in investing”. However, this seemingly cost-free strategy comes with its own set of challenges and trade-offs. The premise of diversification is rooted in the acceptance of an unknowable future. For those who believe they can foresee…
The Secret to Long-Term Investing: Staying Resolute Amidst Market Cycles In the complex world of financial markets, one fundamental truth prevails: everything moves in cycles. These cycles are often the result of emotional decisions that cause markets to swing like a pendulum. At times, these market cycles can reach the extreme ends of human emotions:…
What Real Life Financial Planning Looks Like Investors often grapple with the challenge of achieving their long-term financial goals while avoiding the anxiety-inducing rollercoaster of market volatility. They naturally prefer to participate in the market when it’s on an upward trajectory, but this desire for one-sided certainty can lead to misguided actions and decisions. Investors…
What Real Life Financial Planning Looks Like There is a lot of confusion around what a financial planner does. The best financial planners don’t just do one thing. They help you manage your entire financial life. This picture above from Max Pashman does a really good job of showing everything that a GREAT financial planner…
We are often not as in control of our choices as we think We love to consider ourselves as conscious agents that are in control of all our actions. Research suggests that we are often not as in control of our choices as we might think. Every day, we make countless decisions, from what to…
We are often not as in control of our choices as we think Every day, we make decisions that shape our future. When we make decisions there is an interplay between cognitive and emotional biases, which can profoundly impact the quality of our choices. Our minds have two parts: one that thinks about things and…
One Year Returns Don’t Matter Ben Carlson has put together a chart displaying how long-term market returns vary slightly, but we observe a wide dispersion in short-term returns. Returns in any given year are all over the show but 30-year returns don’t change all that much over time. Long-term minded investors with discipline harvested decent…
Compounding, Time, and Becoming a Lifetime Investor The power of time and compounding can significantly enhance the odds of success for long-term investors. Unfortunately, many investors fail to build their investment plans on these strong foundations, leading to a disconnect between the potential of compounding and the behaviour of the average investor. Understanding the Magic…
Health, Wealth, and a Fulfilled Life In today’s fast-paced world, our focus often tilts heavily towards building wealth, leading us to overlook the vital importance of looking after our health. In the relentless pursuit of financial success, we tend to neglect both our physical and mental wellbeing. This skewed allocation of time and effort towards…
The Familiar Tale of Investment Folly We find ourselves trapped in an all-too-familiar plot, witnessing a recurring phenomenon where investors fall prey to chasing outsize returns, only to be left disappointed and burnt. The ARK Innovation ETF, once the largest actively traded ETF, serves as our protagonist in this narrative. Its meteoric rise during the…