As stock market prices have sharply declined this year, many investors have sold into a declining market. Many live in an extreme state of anxiety while prices continue to fall further and their pension plans and investments post losses at a time when the cost of living has increased and the policy of central banks […]
We must understand what’s the best for us, not for anyone else Written in 1750 by Adam Smith, whom many consider to be the father of economics, these wise words speak to our appetite for risk and our human propensity for making emotion-driven behavioural errors. To be a truly successful investor the central challenge is […]
Concentrating our allocation of capital on a few names or big ideas makes us feel like geniuses when prices are rising – and fools when prices fall sharply and keep on falling
While gold has been sound money for thousands of years, Bitcoin does not yet have this pedigree and is hitherto untried and untested in a real financial crisis.
…skim milk masquerades as cream’ When investing in tradable securities, we sit across the table from the financial alchemists of Wall Street and the City of London. Unlike shares in companies, bonds are mostly bought and sold over the counter (OTC) and are not subject to the same scrutiny as the common or preferred stock […]
Like the black rhinoceros, investment counsellors that place the interests of their client above their own are close to extinction. In the last 30 years, the investment industry has morphed from making money for clients to making money from clients. As a result, sensible investors should question what they own and why, and not assume […]
Economist Milton Freidman was right about ‘temporary’ government spending. In 1803, the UK government devised income tax as a temporary measure to pay for the Napoleonic Wars. It’s still here! In 1971, President Nixon removed the physical gold backing of the US dollar. He promised in his speech to the nation that it would be […]
Adam Smith, ‘the father of economics’, was a 19th-century economist, philosopher and thinker who said, “A stock doesn’t know you own it.” All investors at some point become painfully aware of this reality. We are all mortal beings with a specific life span; not so the stocks in which we invest. Stocks that have a […]
How we own gold is a function of why we own it. We may buy gold as an ornament, as a speculation or against the depreciating purchasing power of currencies and other assets and as crisis insurance. For the speculator who needs exposure to the gold price, holding gold in an exchange traded fund (ETF) […]
Markets are made of people. As a result, movement of market prices ultimately reflects collective human behaviour, greed and fear, endeavour and ambition. Global stock prices continue to rise, and many are now at historic highs. This asset price inflation has attracted many speculators who see an opportunity to make money quickly, but for a […]
