When you’re left without your expert.
“So what if you are no longer here?”
After years spent lecturing about money and investing, I wondered if anything had been absorbed. The question becomes more pertinent as you grow older because the advantage of time, which compounds your wealth, has a diminishing impact and your flexibility is more constrained by what you have set aside.
Do they make any sense in the financial industry?
“So what if you get hit by a truck?”
Occasionally I get asked that question and it’s not a silly one. The clients I work with have an interest in knowing the answer, since without me (or, more specifically, my functioning brain) they may have to worry about what to do going forward. At least in theory an organization with more than one person provides a higher level of continuity than any single individual (especially for decision making or homogeneity of process), and large asset managers and consultants claim to do this, making it a brand-building factor.
Watch out for the good looking ideas.
As you can see in this 40-second clip from a very popular series of British TV ads, Sergei is in a serious pickle. While you ponder whether he made the right decision (do it alone: my wife and I had a fight on this), I’d like to interest you in another question: what type of investment should we favor from a temporal point of view?
When it comes to investing, we’re still all cavemen (and cavewomen).
There is no doubt that rationality is overrated and that behavioral elements in our daily lives are far more important than we all care to admit. Nowhere is this more evident than in investing, where research has shown we are at our most vulnerable.
THIS WILL BE TOUGH
(Ri-Rf)t=alphai,t+βrm,t(RM-Rf)t + βsmb,tSMBt + βhml,tHMLt + βumd,tUMDt + єi,t
Exactly how not to think when investing your money.
“Did he really say that?”
“Yes.”
“Are you sure?”
“Yes.”
My colleague (not the same I recently posted about) and I stared at each other. Our boss had just uttered one of his maxims.
