The concept of the Equity Risk Premium (ERP) is typically used in share market investments, but I believe investors should apply a similar approach to all investment decisions. To ensure investors are adequately rewarded for the risk they take, I like to think of it as the Investor Risk Premium. What is the equity risk …
I recently met with a new client that I had previously met 10 years ago. Back then, he opted to work with an advisor in his home state rather than engaging us, since he did not live in Victoria. In the end, he never found an advisor and decided to manage his investments himself. Fast …
If you’ve been following my blogs for a while, you’ll know that I’m a strong advocate for evidence-based investment strategies. Put simply, I only employ investment strategies that have a proven track record – where the evidence overwhelmingly shows that a rules-based approach has consistently delivered strong returns over many decades. This approach gives us …
At the start of this month, the US market dropped by 6%, and Australia followed suit with an identical decline. In the week after, the US rebounded by 3%, whilst Australia only managed a 2% recovery. This situation got me thinking: why does it seem like the Australian share market consistently underperforms compared to international …
When discussing share investing, I often advocate for using several low-cost, rules-based, evidence-backed indexing strategies. While most are familiar with traditional market cap indexing, I thought it would be worthwhile to explore alternative methodologies and when and how to use them Traditional market cap indexing The first retail index fund was launched by Vanguard in …
Borrowing to invest in property is a popular investment strategy in Australia. It’s often seen as less risky than borrowing to invest in shares. But we should not be so quick to discount the strategy of borrowing in the share market. If implemented correctly, it can be very effective. The power of gearing isn’t exclusive …
The price of Bitcoin has risen 64% in 2024 so far. That’s after rising 156% in 2023! Last week, a client brought to my attention that the CEO of the largest asset manager in the world, Blackrock, suggested that crypto is a good long-term store of value. He likened it to digital gold. This might …
The stock market has kicked off the year on a positive note, reaching record highs in the US. While this may initially appear promising, it’s essential to consider potential risks that investors need to be mindful of. On the flip side, I identify promising investment opportunities amidst these considerations. Past performance should guide decision-making The …
Navigating the stock market in the coming years may prove challenging, primarily because markets need to adapt to higher interest rates. Whilst there are significant risks to avoid, I also believe there are promising opportunities worth considering. Do these 3 things to successfully invest in stock markets To maximise your investment returns in the stock …
Exchange Traded Funds (ETFs) have gained significant popularity in the past 8 years, with total investments in Australian ETFs soaring from $20 billion in mid-2015 to over $150 billion by mid-2023, representing a remarkable growth rate of more than 27%. This surge can be attributed to the compelling advantages ETFs offer over traditional managed funds. …
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