“Prediction is very difficult, especially if it’s about the future.”
Niels Bohr, Nobel laureate in Physics
Royal Commission – Asleep at the Wheel?
With the Banking Royal Commission in full swing, the spotlight is squarely on financial services regulators. Future Fund chairman and former federal treasurer, Peter Costello, stated it plainly: “The next step of the royal commission is to actually find out why the regulatory agencies weren’t awake and at the wheel.1“
Punching Well Above Our Weight
Should You Buy Bitcoin? Ask a Different Question First
Chasing Alpha: Fools Gold!
As an investor you are constantly inundated with information: Where is the market heading, top 5 buys, top 5 sells etc. This clamour will increase in pitch as we approach the end of the year with predictions for which way the market is headed next year, it will roll in to it elections, status of large projects, weather predictions etc. and yet somehow there will still be several unanticipated events – some government falling, attack or sanction by the UN / USA and everything will be abuzz and different to the predictions anyway. This will all be exciting and exhilarating stuff, calling out to all investors to keep watching the latest updates. We have been saying for many years, it makes sense for the media to turn finance and investing into entertainment, to get more eyeballs and therefore advertising big bucks for them. Clearly, it is a self-serving purpose and they are not really doing you any favour.
FAANG Investing
Putting the human into investing
What’s the ideal investment strategy? Is now a good time to be in shares? How do you get a decent return on cash investments? Should currency risk be hedged?
Questions of this kind, often seen in the financial media, tend to confuse means with ends. The answer in every case is “it depends”.
How do you break a bad investment habit?
Often these behaviours are the result of conditioned responses. We can have both good and bad investment habits. The key takeaway is understanding how they are created.
In his excellent book, The Power of Habit, Charles Duhigg explains why we continue to do self-destructive things. According to Duhigg, there are three components to forming a habit: cue, routine and reward.