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Stairway

Stairway to Heaven

Have you heard about the link between iPhone sales and incidences of deaths from falling down the stairs? Warwick Schneller from DFA investigates Spurious Correlations and letting this thinking drive investment strategies.

Robots with Coins

Putting the human into investing

What’s the ideal investment strategy? Is now a good time to be in shares? How do you get a decent return on cash investments? Should currency risk be hedged?

Questions of this kind, often seen in the financial media, tend to confuse means with ends. The answer in every case is “it depends”.

Saying No

How do you break a bad investment habit?

Bad investment habits are the norm, not the exception. They include panicking and bailing out at generational market lows, like what too many did in 2009. Conversely, the same people often buy aggressively into market bubbles, like the technology debacle at the turn of this century.

Often these behaviours are the result of conditioned responses. We can have both good and bad investment habits. The key takeaway is understanding how they are created.

In his excellent book, The Power of Habit, Charles Duhigg explains why we continue to do self-destructive things. According to Duhigg, there are three components to forming a habit: cue, routine and reward.

Australian-Money-Budget

Warren Buffet makes $1million bet. On what you may ask?

Warren Buffett is the second richest man in the world because of his extraordinary performance as an investor. In contrast to his skill and good fortune, he has been quoted many times that he believes most institutions and mum and dad investors are better off investing in low-cost index funds. In fact, he has instructed via his Will that his estate be invested into index funds for his beneficiaries, having said that, the bulk of his estate has been left to a charitable foundation, so the kids may only get $1 billion each. How will they ever survive? Anyway back to the bet.