THIS TIME IS DIFFERENT

Two critical aspects of an investment that are overlooked

IN every crisis, fortunes are lost. While the exact circumstances are specific to each situation, the primary reason is often too large a focus on illiquid investments, and not assessing the assets' fragility during a crisis.

THIS TIME IS DIFFERENT

Double or nothing

I WAS getting an update on one of my family investments in 2010, by an established private equity firm. This was the first visit after having invested for five years, as the marketing salesperson was promoting their next fund.

THIS TIME IS DIFFERENT

Are low-volatility returns too good to be true?

STARTING in 1990, an exclusive investment fund produced an enviable track record. Over the next 18 years, it would return 11 per cent per annum (p.a.) Even better, during this long track record, its worst performing month was -0.64 per cent. On average the fund had one negative month per year....

THIS TIME IS DIFFERENT

Yield curve inversion = Imminent recession?

BEARS love indicators to justify their gloomy outlook. The aptly named "Death Cross" is one of the favourites of technical analysts, while an inversion of the yield curve is a favourite of fundamental analysts and economists.

THIS TIME IS DIFFERENT

Investor pessimism: is the world outlook getting worse?

THE queue was ten-children long, when the first one in line passed out, causing some commotion. The second child went through without any problems.

THIS TIME IS DIFFERENT

When the market does not react the way you expect

"DO as I say, not as I do" was attributed to preachers, but would work just as well for the investment advisory business....

THIS TIME IS DIFFERENT

Your investment outlook vs the consensus one

IT'S a good idea from time to time to pause and assess how similar your investment outlook is to the consensus of chief economists and other assorted forecasters. The beginning of the year is a perfect time to do this, as the flood of reports titled "Outlook for Next Year" usually...

THIS TIME IS DIFFERENT

An investment strategy that consistently underperforms

THERE'S a popular investment strategy that consistently underperforms the market. You are unknowingly likely to be allocating part of your investment portfolio to this strategy, whether directly or indirectly by owning some of the many funds that follow it....

THIS TIME IS DIFFERENT

What to expect in the current bear market

WE are in the midst of a global economic slowdown, with the US being the only bright spot globally. Global leading indicators have turned negative; the one-off boost in year-on-year comparisons from the US tax cuts will be absent next year; and the escalating US-China trade war creates...

THIS TIME IS DIFFERENT

Getting high on bubbles

IN his famous speech on "Irrational Exuberance", former Fed chairman Alan Greenspan commented about how difficult it was to recognise the characteristics of bubbles if we saw them. He reckoned back then that it's not really possible....

THIS TIME IS DIFFERENT

Liquidity crunch and emerging market crises

IN financial markets, very few things can be expected to repeat regularly like clockwork. Crisis periods in emerging markets (EM) are one such occurrence that we see every four to five years.

THIS TIME IS DIFFERENT

Investing with perfect hindsight

A COUNTRY'S gross domestic product (GDP) growth announcement is one of the most heavily analysed economic data. Investment recommendations for a country's stock markets are continually made based on a projection of increased economic growth. With so much scrutiny into GDP, we are led...

THIS TIME IS DIFFERENT

Interviewing for a finance position

THE single best investment that anyone can make is to invest in ourselves, for a better career and higher earnings prospects. These goals lead many young graduates to seek a career in finance.