Most of us have seen ourselves as stock pickers extraordinaire at some point in our investing journeys. The idea of investing in stocks is exciting, seductive even. After all, all you need to do is press buy and sell online and you could make yourself a fortune.
Most of us have seen ourselves as stock pickers extraordinaire at some point in our investing journeys. The idea of investing in stocks is exciting, seductive even. After all, all you need to do is press buy and sell online and you could make yourself a fortune.
Every technological revolution eventually runs into a physical constraint. For AI, it’s becoming clear that bandwidth and energy are the main barriers the technology needs to navigate. The enormous computing clusters used to train and run modern AI models now consume staggering amounts of electricity and generate unprecedented data traffic between chips, servers and data centres.
The ‘4% rule’ is one of the more widely quoted guidelines for investors approaching or during retirement. It was originally developed by financial planner William Bengen using historical market simulations which suggested retirees could withdraw 4% p.a. from their portfolios without exhausting their savings over a thirty-year retirement.
For the longest time global investment markets been defined by the implicit assumption that globalisation, relative geopolitical stability and expanding trade would continue indefinitely. However, that assumption is being tested.
Investors are generally taught to focus on average returns as a gauge of investment success. This makes intuitive sense to most. Over the long run, developed market equities have delivered average returns of around 10% p.a. That solid result has reinforced the advice: stay invested, reinvest your dividends and compounding will do the heavy lifting for you.
Most investors tend to think of systemic risk as something that arrives with a bang, like a banking crisis, a pandemic, or a war. Increasingly, the more realistic systemic dangers are slower to gauge and harder to price. They are an ominous set of interconnected and interacting stresses that have the potential to degrade the very conditions required for markets to compound at all.
One of the great emerging benefits of AI is that it allows self-directed investors to take better control of their financial destinies. With its fast-improving capabilities, valuable financial advice may be available at your fingertips. Or so the theory goes.
Passive investing has reshaped global equity markets over the past decade. Record inflows into low-cost ETFs have led many investors to question whether active management still has a meaningful role.
There’s a uniquely Australian breed of wealth creator who achieved financial independence before the age of 30 by accumulating a sprawling property portfolio.
Many investors think selling is an easy part of investing that doesn’t require a lot of thought. In contrast, buying is exciting. It requires an understanding of valuation numbers, corporate fundamentals, and the macro environment. For many investors, these are interesting challenges that are an enjoyable part of investing. Yet, selling feels to many like an administrative process that’s executed more out of necessity. It’s the dotting of the investment i’s and the crossing of the t’s that concludes the process.
There’s a crossroads in the financial lives of most households when wealth growth is either ignited or postponed. It’s a single habit shift that’s simple, and far from glamorous.
Cryptocurrencies must surely be the most polarising asset class in the modern financial era. On the one hand, they promise decentralised finance, immutable digital money, and permissionless innovation.