Good reads from around the Web.
You are not going to find a more pithy comment in this week’s reads than this note from Nate Tobik at Oddball Stocks.
Fidelity released a study discussing a performance breakdown for their accounts.
The clients that did the best were the ones who were dead.
The second best performing set of clients forgot they had Fidelity accounts.
It seems like a formula to beat the market is to start an account, forget about it, then die.
Your heirs will thank you and marvel at your investing prowess.
Nate’s post goes on to discuss the ramifications for stock pickers.
But to be honest, he really makes the case for passive investing as persuasively as any passive guru ever could.
When we look in the mirror we’re facing the enemy of our returns.
The best course of action is to pick a strategy, stick to it and move on.
For most people, that strategy should be to outsource their stock picking to the markets, via cheap tracker funds.
Then stick to it, and move on.
From the blogs
Making good use of the things that we find…
- Who needs all these newfangled ETFs? – Reformed Broker
- Latest investing developments [Video] – Rick Ferri
- Ending the passive/active distinction – Pragmatic Capitalism
- Passive investing is even better for the wealthy – Evergreen Business
- What if everything is overvalued? – AWOCS
- Optimists make more money – Jeff Macke
- Don’t bother currency hedging foreign equities – Value Perspective
- Confessions of a mechanical investor – Richard Beddard
- Chris Sacca on private equity’s skewed incentives – AWOCS
- Digesting stock gains – Investing Caffeine
- Cash, debt, and P/E ratios – Musings on Markets
- International investing is easy – The Escape Artist
- Do you need £500,000 a year to live in London? – FIRE v London
- Substituting income annuities for bond funds [US but relevant] – FA
- Softening sequence of returns risk – Retirement Investing Today
- 12 investing lessons from Seneca – 25iq
Product of the week: Tracker mortgage rates have fallen below 1% for the first time ever, reports The Telegraph. The Chelsea Building Society is offering a two-year tracker mortgage charging 0.48% over Bank Rate, for a total cost of 0.98%.
Mainstream media money
Some links are Google search results – in PC/desktop view these enable you to click through to read the piece without being a paid subscriber of that site.1
- Interview with Jeremy Siegel about ETFs and indexing – ETF.com
- Roth: On economic news and the stock market – AARP
- A low cost way to invest in the US – Hargreaves Lansdown
- VCT wind-up could leave investors with tax bill [Search result] –FT
- Stocks top US fund managers are buying and selling – Morningstar
- How Jim Simmons built his rare winning hedge fund – Alpha Architect
- Meet the 99-year old adviser still going strong – Investment News
- John Lee: Do bosses pass the fruitcake test? [Search result] – FT
Other stuff worth reading
- Millions snared by income tax traps [Search result] – FT
- Inside the minds of early retirees – CNBC
- Sky accused of guilt tripping subscribers – Telegraph
- New kiosk will turn old foreign money into cash – ThisIsMoney
- The lucky French who take more holidays and work less – Guardian
- Lettings relief on rental property – Guardian
Book of the week: Monevator reader and personal finance blogger John Hulton has published his third e-book, DIY Simple Investing. It’s a commendably straightforward guide to the basics of investment, with a sensible bias towards the passive approach. Given it costs just £3.43, there’ll be plenty of money leftover to pay those ultra-low index fund fees!
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- Note some FT articles can only be accessed through the search results if you’re using PC/desktop view (from mobile/tablet view they bring up the firewall/subscription page). To circumvent, switch your mobile browser to use the desktop view. On Chrome for Android: press the menu button followed by “Request Desktop Site”. [↩]