Finance Wisdom
Identifying All Star Fund Managers II – Finding the All Stars
“Ignorance more frequently begets confidence than does knowledge.” –Charles Darwin In the last article, we looked at the first step in identifying All Star Fund Managers – getting rid of the bottom 90% of fund managers/investors. This article is about the final 3 steps in the process that take us from the top 10% to…
Read MoreIdentifying All Star Fund Managers I – Cross off the Bottom 90%
All Star Fund Managers
Read MoreWhy the Long Term Growth of the Economy is Not Relevant to Investing
Our last article explained why the economy is not relevant to investing – short term. If you want to forecast the stock market this year or next year, the economy is essentially irrelevant – because the stock market forecasts the economy, not the other way around.
Read MoreWhy the Economy is Not Relevant to Investing
“I’ve always said if you spend 13 minutes a year on economics, you’ve wasted 10 minutes.” – Peter Lynch Many investors believe there is some sort of cause-and-effect between the stock market and the economy. They think that if they can predict the general direction of the economy, it will help them predict the…
Read MoreCloset Indexers vs. Stock Pickers – Truly Active Managers Outperform
In the last article, we introduced the concept of “Active Share” – the degree to which the holdings in a fund differ from the index – based on a study by 2 Yale academics. Here are some of the other valuable insights from the study.
Read MoreTruly Active Managers Outperform – Being Different is Key
The popular opinion among investors supported by many studies claims that most fund managers underperform their index, so you are better off just investing in an index fund or ETF (Exchange Traded Fund). However, truly “active” fund managers have significantly outperformed their indexes after all fees over the long term, based on a very comprehensive…
Read MoreAvoid the 5-Year Fixed Mortgage Trap
Number 3 on our list of things on which Canadians waste the most money is 5-year fixed mortgages. They are marketed as being safe and a good protection against a sharp rise in interest rates. The reality, though, is that they are nearly always a huge waste money, they limit your flexibility and result in…
Read More6 Common Myths about Stock Market Returns
How did you do with the 12 questions in the first article of this series? We have found that most investors have quite exaggerated views about long term stock market returns, mainly believing they are much more erratic than they are.
Read MoreCommon Myths about Stock Market Risk
How did you do with the 12 questions in stock market quiz? We have found that most investors have quite exaggerated views about stock market risks, especially after 2008.
Read MoreHow Risky is the Stock Market – How accurate are your perceptions? (Quiz)
“Half the lies they tell about me aren’t true.” – Yogi Berra We talk with people and read articles and books every day about investing, and are constantly shocked at how little most people know about the real risks and returns of the stock markets. The bear market of 2008 has only made the…
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