Ask most private investors about their opinion of investing in small companies and they will happily tell you that ‘investing in small caps exposes investors to an information mismatch which enables outperformance’. The idea is a simple one. Big funds with professional analysts have too much capital to deploy to worry about investing in companies […]
As we leave 2022 behind, it’s traditional for many of us to review our performance over the last twelve months. I thoroughly enjoy reading these reviews and as usual there has been a wide spread of results across the board. A small number of investors I follow managed to turn a profit, my 11% loss
One of the most common statements I hear from fellow investors is the idea that they are ‘long-term’ investors and that short-term price fluctuations do not concern them. In today’s blog, I want to unpack the idea of what it means to be a long-term investor and consider some of the challenges and benefits that
For the first time in a while, I picked up a paper copy of the Financial Times this weekend. Although I’m a regular reader of the paper, I tend to consume the digital copy more than the paper version these days and it was quite a decadent treat to enjoy leafing through the original format.
Earlier this year I was speaking to a friend about investing and felt like I was standing in front of a metaphorical firehose of investing noise. “Henry, have you read about Bitcoin? I made 30% last year on it!” “I made a bet on a gold miner, they have access to three mines but the
So, a little later than I expected, I’m pleased to publish the next article in my series about Investment Idea Generation. In the first article in this series, I wrote about the topic of selecting investment goals, different types of assets and asset classes, and the different investment vehicles available to investors looking for alternatives
In my last article, I indicated that I wanted to cover investment idea generation for an investment portfolio in more detail. The very first stage of building a portfolio of investments, far before investment idea generation, is to define your investment goals. For the purposes of this exercise, let us define our goal as income
Listening to the latest Twin Pete’s Investing podcast (which can be found here or here for those heathens that aren’t already dedicated followers), I was particularly interested by a segment where they discussed transparency of investors presenting ‘research’ on social media. The reason I was so interested was because of my own management of this
The Narrative Fallacy is the idea that humans are predisposed towards believing a good story over understanding the facts of a situation. We are often drawn towards less desirable investments simply because they have a good story and then use the story to convince ourselves of the merits of the company in which we are
The last few weeks have reinforced the importance of portfolio managers and private investors having a solid process to protect capital and prevent themselves from opening position which are, frankly, only ever going to lose them money. For those of you that haven’t seen the headlines, a number of tiny US companies such as Bed,
Last year, I wrote an article which introduced some of the ways in which investors misjudge risk management. I always meant to cover the topic in more detail but for one reason or another never got around to it. In today’s article, I want to take a more comprehensive look at investment portfolio risk management.
Long-time readers of this site will remember my failed investment in Carillion – a leading international construction businesses that collapsed under the weight of its debts and ended up in bankruptcy back in 2018. At the time, I largely penned up the collapse of Carillion to poor management and a weak balance sheet but recent
When undertaking a recent review of my portfolio I was struck by the great number of logical contradictions in investing. I’ll be publishing this review in the next few weeks but the process of writing it made me consider all the various hurdles and challenges that investors face. For example; Patience is a great trait
If you’ve followed this blog for a few years, you’ll remember the early articles I wrote about investing for income and an introduction to dividends and today I want to continue that theme with another article about the importance of dividends. I was recently discussing this topic with a friend who told me that they
Earlier today, I had a call with a friend where we discussed the dangers of blindly following other investors. We’ve spoken before about the hidden costs of people following investing charlatans – in some cases, these costs can be absolutely tragic as inexperienced, naive investors are hung out to dry by unscrupulous characters only interested
