Behavioural Biases & Investing
People, by their nature, are biased. Another way of saying this is that everyone tends to preference some things over others, sometimes unfairly. Perhaps you’re biased towards one sports team. Or maybe you’d rather listen to jazz than the blues. Not all biases have serious repercussions. Read More.
Loss vs. Decline
Imagine it’s November 2008 and two people are looking at their portfolios. They both see that the stock market has fallen roughly 40% in just over a year, taking the value of their equity investments down with it. Investor A decides they can’t take it any more and sells. Investor B does nothing. Read More.
Being Mindful: Understanding How Our Brains Affect Our Investing
Human beings are inherently psychological creatures. We get worked up watching our favourite sports teams and cry during sad movies. And we often fear flying more than driving, even though the latter is far more dangerous statistically. Read More.
What to Expect When You're Investing
Depending on your level of investment knowledge, you may be wondering just what you can expect from your portfolio. There’s good news and bad news on this front. The bad news is that we, nor anyone else, have the foggiest idea what will happen tomorrow or next week. We’ll leave that kind of guessing to the pundits on TV. Read More.
Volatility: A Misunderstood Friend in Disguise
When markets become rocky, the term volatility gets used a lot. For some investors, it’s a bit of a scary word, often used to describe sharp declines in the markets (which can be even scarier). On a scale of pleasantness, we’d guess that experiencing market volatility is up there with public speaking and going to the dentist for most people. Read More.
Diversification: A Timeless Strategy
Turn on the business news or read a Wall Street research report and you’ll notice something: many people in the investment world will tell you where to put your money for maximum gain. Buy gold before it soars. Sell bonds before they crash. Or maybe speculate on this stock because it’s destined to go up. Like good comedy, the suggestion is that timing is everything. Do it right and you’ll be rich. Read More.
Ancient Wisdom & your Portfolio
“The chief taskin life is simply this: to identify and separate matters so that I can say clearly to myself which are externals not under my control, and which have to do with the choices I actually control. Where then do I look for good and evil? Not to uncontrollable externals, but within myself to the choices that are my own…” Epictetus, Discourses, 2.5. 4-5 Read More.
Responsible Investing & Climate Change
Two recent news items regarding responsible investment have caught my attention. The first was last November, when Sweden’s central bank said it was dumping Alberta’s bonds as it moves to divest from issuers with high carbon-dioxide emissions. Read More.
How to Prepare for the Next Bear Market
The sun is currently shining on the stock market. And for most investors, it probably feels pretty comfortable. But it’s during the good times that investors need to make sure they’re prepared for an inevitable downturn. While it’s practically impossible to predict when the next bear market will hit, being ready for it can make all the difference. Here are 5 ways to survive and thrive when the market takes another extended tumble. Read More.
Avoid These Common Investment Errors
What do investing and tennis have in common? We could probably come up with a few similarities, but avoiding unforced errors has to be top of the list. In other words, while you can’t control what the market (or your opponent) does, you can do your best to ensure you don’t make avoidable mistakes with your own decisions. Read More.
The Financial Media Can Be Harmful to Your Wealth
Nowadays, it’s pretty much impossible to avoid talk of the markets. There are 24/7 cable channels devoted to investing and business, newspaper articles and internet coverage. The wall-to-wall talk long ago reached the point of oversaturation. Read More.