Any of these sound familiar?
When it comes to your financial plans, do you do the same?
Let's have a look at what these assumptions could be costing you.
Attention is a precious resource.
And as with any resource, scarcity creates value.
In the digital age where noise is everywhere, those who can capture the most attention are said to win.
Ask a farmer about average rainfall and he’s likely to react sceptically. Knowing how actual rainfall varies from year to year, farmers carefully manage their crops and irrigation. It’s a lesson many investors could learn as well, with published ‘average’ returns masking a wide range of possible outcomes.
The lure of trying to time the market may tempt even long-term investors. But outguessing markets isn’t as straightforward as it sounds.
In Leo Tolstoy’s great novel ‘War and Peace’, a Russian general charged with defeating Napoleon and expelling the French from Russian soil argued against rushing into battle, saying the strongest of all warriors were “time and patience”.
Investors at year-end are inclined to reflect on the 12 months gone and muse on what the coming year might bring. Aware of this appetite for speculation, the media tends to feed it with forecasts. These articles can be fun to read, but are even more so a year later.
Do you remember the Kerrigan family in the classic Australian movie, The Castle? They saw themselves as the “luckiest family in the world” when Dad got a great deal on a property in Bonnie Doon with a mobile kit holiday home overlooking massive electricity power lines. “How’s the serenity?” was one of many famously comical lines.
If you’ve hit 40 and still don’t have your financial affairs in order, it’s never too late to do something about it. We Talk Money’s Tony Sandercock offers advice for getting on track.
This blog was originally posted in "Slice of Life".
Just because political or financial news is a diversion, a challenge or even entertaining, doesn’t mean it’s actionable. In fact, what people outside the media rarely appreciate is how many of the headlines you see every day are effectively meaningless. And it’s been really getting on my goat lately! So in this article, I’ll interpret some of the most common headlines and what it actually means for your investments.
WE TEND TO FAVOUR THE ALREADY FAMILIAR
Everybody loves the comforts of home, but investors who become too anchored to familiar territory can end up with a very narrow view of the world. Home bias, the tendency of investors to allocate a disproportionate amount of their money to their domestic market, is a well–documented phenomenon.