Behavioral Finance

Are Markets Efficient?

In 1907, a man named Francis Galton discovered something fascinating at a fair. He noticed that when 787 people guessed the weight of a cow, the average guess was almost exactly right. This showed the power of the “wisdom of crowds” – the idea being that a group of people can produce a very accurate …

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Market Crash Investing For Dummies

Investing in the stock market is as much a test of emotional resilience as it is of financial acumen. Understanding the psychological whirlwind investors face during market downturns is key to navigating these turbulent periods with your wealth—and sanity—intact. Here’s what I’ve learnt over my career about human behaviour when markets are volatile and/or take …

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This Time It’s Different

As someone who embarked on their investment career shortly after the 2008 global financial crisis and weathered the storm of the 2020 stock market crash, I’ve witnessed first-hand the cyclical nature of financial markets. These crises, though different in their causes, share a common aftermath: the lasting impact on investor portfolios and psyche. Despite the …

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Margin Of Safety

One of my favourite Benjamin Graham investment quotes is, “The purpose of the margin of safety is to render the forecast unnecessary.” There so much insight and wisdom distilled into that eloquent line. The major point about the margin of safety is that it removes the speculator’s need to predict the future, thus turning that speculator …

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Shiny New Toy

In the realm of investment management, one of the most challenging tasks is convincing clients that jumping onto the bandwagon of the latest, most sophisticated thematic funds might not be the silver bullet they’re seeking for their portfolio. It’s a tricky situation when a portfolio is underperforming. Most times, doing nothing is probably the best …

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Buy When There’s Blood in the Street

Market downturns, like the one caused by the Covid-19 pandemic, often result from a mix of factors including economic bubbles, panic selling, high interest rates, geopolitical issues, or unpredictable events. These declines can be exacerbated by aggressive traders who, facing margin calls, liquidate their holdings, further driving down the market. However, such downturns can also …

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Market Multiverse

Investing isn’t just a quest for wealth; it’s an exhilarating journey of self-discovery and awareness. This holistic approach differs starkly from the narrow focus solely on financial gains, often ignoring the deeper emotional and intellectual gratification that investment can bring. A standout example of this enriched experience is the art of diversifying your investment portfolio. …

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Unlocking Success: Understanding and Applying the Dynamic Triangle in Life and Financial Planning

In the world of psychology and self-improvement, there’s a powerful concept known as the dynamic triangle. This concept, rooted in cognitive behavioral therapy (CBT), revolves around the idea that our thoughts, emotions, and actions are inextricably linked. The dynamic triangle teaches us that how we think affects how we act and feel, how we feel …

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Charlie’s Mental Models: The Path to Fulfillment, Success, and Wealth

Charlie Munger, best known as the longtime business partner of Warren Buffett, is not just a financial genius; he’s also a philosopher in his own right. His University Commencement Speech is a treasure trove of insights, not only about investing but also about life itself. Today, we’ll delve into the lessons Munger imparts through his …

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