Weekend Reading – Weak Currencies: How To Avoid Losses
Weekend Reading is a collection of Investment Research and Lifestyle topics from all corners of the Web.We source the highest quality insights from Wall Street and Main Street that you may apply to your investment process. Unlike the rest of Bankeronwheels.com, this series is provided without additional guidance. As usual, everything is to be used at your own risk. Below is the type of content we shortlist.
Invest Wisely section is dedicated to research on how to invest for the Long Run using Passive Investment Strategies. Read Topics related to (i) Portfolio Construction and Asset Allocation (ii) Acting wisely by avoiding behavioural traps and also (iii) publications that help understand how financial markets work.
Active Investing section relates to improving your knowledge about active investing. If you decide to sin, then sin only a little. Given ample evidence, combined active bets should be ideally a relatively small fraction of your portfolio. This section also includes Sustainable Investing. You can invest in a Socially Responsible way, but there are many ESG traps. Learn how to invest sustainably, and what it means for expected returns, with our definitive guide to sustainable investing.
Personal Finance section is dedicated to UK and European Products. It can also touch on other European jurisdictions outside the Euro-zone.
- Recommeded Reading
- Youtube (Required watch time)
- Podcast (Listening Time)
- Academic Research - May require intermediate/advanced knowledge
- Noteworthy Twitter Thread
Pleasant as it may be to bask in the warmth of recovery… the time to repair the roof is when the sun is shining
INVEST WISELY
CONSTRUCT YOUR PORTFOLIO
Should You Hedge Your Bonds? (Bankeronwheels.com)
Navigating the world of bonds can be a treacherous journey, especially when it comes to currency hedging. Can your strategy change based on your home currency? Does it matter if you invest in Euros, or Swiss Francs? Is the British Pound any different? What about other currencies? Is the decision to hedge impacted by your life situation and goals? What about other currencies? Is the decision to hedge impacted by your life situation and goals?
UNDERSTAND FINANCIAL MARKETS
- Visualizing Every Company on the S&P 500 Index (Visual Capitalist)
- BRICS is fake (Noahpinion)
- Why China's economy ran off the rails (Noahpinion)
- The Great and Awful Thing About These Interest Rates (Irrelevant Investor)
- If the UK stock market is cheap, why doesn’t it go up? (FT.com, click on the first link)
- 15 Ideas, Frameworks, and Lessons from 15 Years of Investing (Corey Hoffstien)
How Dividends contributed to total returns depending on market environment (Wisdom Tree)
Dividends contributed nearly 30% to the 10.4% annual total returns of the S&P 500 over the long run. In the 1970s, a decade characterized by high inflation and weak economic growth, dividends made up 70% of total returns. The 1990s—the decade of the dot-com bubble—had the lowest contribution from dividends of just 15%.
Read more on Wisdom Tree
HOW TO INVEST
Active Investing
FACTOR investing
Returns for the S&P 500 and Dimensional US Small Cap Value since 1927 (Dimensional Funds)
Anyone who’s ever bought a used car knows the importance of avoiding a cherry-picked depiction of history. Low mileage and regular oil changes don’t matter much if the seller fails to mention the car was once submerged in floodwater. Many investors have been drawn to the shiny-object stocks of the S&P 500 index on account of their recent performance—since 2010, the large cap S&P has outperformed US small cap value stocks by an annualized 1.7 percentage points. the decade of the dot-com bubble—had the lowest contribution from dividends of just 15%.
Read more on Dimensional
discretionary investing
Valuations, economy may favour value stocks (Vanguard)
As measured by the Standard & Poor’s 500 Index, U.S. stocks have risen more than 20% since they hit a trough in mid-October 2022—a dismal year that brought the S&P 500’s worst calendar-year decline since 2008 but just its second loss in 14 years. They’ve roughly doubled in value since the pandemic-induced low of March 2020. The extent and pace of the gains are enough to make the wary equity investor wonder: Where is there opportunity in the U.S. stock market?
Read more on Vanguard
7 key valuation lessons from Aswath Damodaran (Daniel)
Aswath Damodaran is the ‘Dean of Valuation.’
For almost four decades, he has been teaching valuation at NYU. He also teaches millions of people online.
Here are 7 Key Valuation Lessons from him
Read more on Twitter
- These five videos are a masterclass for investors. (Long Equity)
- AI, Digital, Data Disruption - With Ulrike Hoffman Buchardi of Tudor Investments (Meb Faber - 46 min)
- Investment Unicorns: The Only Financial Novelty That Hasn’t Been Disgraced (Morningstar)
- Nvidia vs. AMD vs. Intel: Comparing AI Chip Sales (Visual Capitalist)
ALTERNATIVE ASSET CLASSES
Is the UK housing market going to crash? (Pension Craft - 21 Min )
If we combine the cost of living crisis, soaring interest rates, and sky-high prices, it seems as if the UK housing market is set up for a big crash. This video looks at the reasons for and against an impending crash. And, also gives you some forecasts for UK house prices.
WALL STREET
A 40 Minute Charlie Munger Masterclass (42 Mins)
As Berkshire’s Vice Chairman, the 95-year-old Munger is Warren Buffett’s right-hand man. He’s also an investing legend in his own right. Munger ran a firm in the 1960s and ’70s that scored returns of over 24% per year. He’s here to talk about how to make investment decisions and life choices that help secure prosperity and longevity.
SUSTAINABLE investing
crypto
Looking at Bitcoin within a 60/40 portfolio. (Morningstar)
Bitcoin Index posted a 76.4% return through July 2023 in defiance of the gloomy narratives that haunt the rest of the cryptocurrency ecosystem. The trusty balanced portfolio has also beaten expectations as of late. So far in 2023, risk has paid handsomely. That fact may leave many investors wondering whether to add some extra firepower to their portfolio in the form of an allocation to bitcoin.
Read more on Morningstar
BAD BETS
FROM Bankeronwheels.com
Beat Most Investors with FREE ETF Master Guides
- Get Rich, Slowly but Surely – We designed Equity ETF selection frameworks and then picked the best funds in each category, so you don’t have to.
- Become a Passive Investing Ninja – Have no mercy for Financial Institutions. Cut TERs, Taxes, FX Fees and Invisible Costs.
- Licence to Yield – Which Bond ETFs for your goals? How do price change? Should you hedge currencies?
- Don’t get fooled by Wall Street – ESG Ratings are not designed to protect the planet. Adjusted for risk, ESG ETFs will also inevitably underperform. So how can you invest Sustainably?
From Bankeronwheels.com
Beat Most Investors with FREE ETF Master Guides
- Get Rich, Slowly but Surely – We designed Equity ETF selection frameworks and then picked the best funds in each category, so you don’t have to.
- Become a Passive Investing Ninja – Have no mercy for Financial Institutions. Cut TERs, Taxes, FX Fees and Invisible Costs.
- Licence to Yield – Which Bond ETFs for your goals? How do prices change? Should you hedge currencies?
- Don’t get fooled by Wall Street – ESG Ratings are not designed to protect the planet. Adjusted for risk, ESG ETFs will also inevitably underperform. So how can you invest Sustainably?
PERSONAL FINANCE
Wealth Management
Early Retirement
Cody Garrett is an advice-only financial planner passionate about helping families refine their path to financial independence (FI) as DIY investors. Cody specializes in comprehensive financial plan development, topic research, and personalized financial education.
On this podcast, he joins John Luskin to talk all things early retirement!
FINANCIAL PRODUCTS
COST OF LIVING
OUR Community
Question of the week
From Bankeronwheels.com
We Help You Avoid Costly Investing Mistakes.
Most coaching participants come from the EU or the UK.
But we have consistent demand from all around the world. We provided coaching sessions to individual investors stretching from Argentina to New Zealand, or Guatemala to Japan.
A significant part of our clients are professionals in the Tech sector, Lawyers or Doctors that want to avoid costly mistakes when investing.
We also coach 25-30 year old young professionals that want to maximise assets for early retirement. We also have a large group of entrepreneurs that e.g. receive large lump sums after selling their company and want to invest it in financial markets. We speak to Crypto millionaires that want to reduce their risks.
Finally, some of our coaching clients are in their 40s or 50s and want to set up customised, income-producing portfolios or create Bond ladders for their retirement.
Most of the coached investors are in the 25–60 year old range.
Yes, some of our coaching clients have shared reviews on Google.
Some considerations are included below. For more details, consult your regulator’s website.
A financial coach is:
- Trained but not regulated
- Skilled at reviewing your overall financial situation and goals
- Able to help you develop a financial plan to achieve those goals
- Happy to discuss the pros and cons of various financial products but can’t recommend a specific one for you
- Comfortable working with anyone, whatever their situation
- Going to charge for their time
A financial adviser is:
- Regulated and authorised by the regulator to recommend specific products to clients or is independent and able to offer ‘whole of market’ solutions
- Often, going to charge an annual management fee, typically 1-2% of their client’s assets with initial fees on top.
We are proud to say that our coaching service has empowered a number of clients to reconsider their financial advisers’ offerings. From our clients’ feedback, in a number of cases, clients were overcharged, and offered unsuitable products, often due to conflicts of interest. However, this is not a rule. The best choice between a financial coach and adviser depends on an individual’s unique circumstances, including their financial literacy, time availability, comfort with managing their finances, and complexity of their financial situation.
Beginners often ask us:
- How do I reach my goals – What investments do I need to take into consideration for e.g. Taking a Sabbatical, buying a House or saving for Early Retirement?
- When should I invest – I fear that investing a lump sum in this market may have a negative impact on my returns. How can timing of buying ETFs affect my performance?
- How do I Invest – What are the pro and cons of investing with a Bank? Why should I diversify brokers?
- What should I consider investing in – What are some risks of portfolio diversifiers like Gold or Crypto?
- Avoiding Extra Costs – I have shortlisted a few ETFs, can you help me to compare them before I decide which one to buy?
- Benchmarking – What are educated investors doing in a similar situation to mine?
We are flexible. For example, answering some of these questions could help you avoid very costly mistakes:
- Challenging My Portfolio – Here is my portfolio – what am I missing? What could derail my strategy?
- Accelerating My Understanding – What are inflation linked Bonds? How are they different to Nominal Bond ETFs? What makes them outperform? Why do some investors add small cap value stocks to their portfolios? I want to exclude Tobacco companies from my portfolio – what are my options? What is Factor Investing?
- Simplifying Portfolio Maintenance – How can I diversify my investments? What is historically highly correlated so that I can consider removing it to keep my portfolio simple? How do I perform rebalancing? Does frequency matter?
- Reducing Risks – I want to understand the risks of investments – what are the different measures and how does it impact me? What are the risks of different types of brokerage accounts?
- Understanding the Impact of Recent Events – How do recent events impact my portfolio? What can I do to protect my savings from shocks?
- Investing Goals – I am investing for a specific goal e.g. Early Retirement, what is the research saying about e.g. the amount I need to have accumulated, how much can I withdraw annually? What are some calculators available and how to run them? What are the assumptions/shortcomings of these models?
- Comparing Equivalent ETFs – I have certain constraints in my tax-wrapper and can only select certain funds (e.g. I live in France and limited to specific synthetic ETFs). Which ETF characteristics should I pay attention to?
From Bankeronwheels.com
Get personal help To Set up your portfolio
We Help You Avoid Costly Investing Mistakes.
Sometimes individual sessions are very helpful to get past your investing concerns. Our readers asked us to create coaching sessions. And we’re proud to say, that some of them even ditched their Financial Advisors, after experiencing the value we provide.
Most coaching participants come from the EU or the UK.
But we have consistent demand from all around the world. We provided coaching sessions to individual investors stretching from Argentina to New Zealand, or Guatemala to Japan.
A significant part of our clients are professionals in the Tech sector, Lawyers or Doctors that want to avoid costly mistakes when investing.
We also coach 25-30 year old young professionals that want to maximise assets for early retirement. We also have a large group of entrepreneurs that e.g. receive large lump sums after selling their company and want to invest it in financial markets. We speak to Crypto millionaires that want to reduce their risks.
Finally, some of our coaching clients are in their 40s or 50s and want to set up customised, income-producing portfolios or create Bond ladders for their retirement.
Most of the coached investors are in the 25–60 year old range.
Yes, some of our coaching clients have shared reviews on Google.
Some considerations are included below. For more details, consult your regulator’s website.
A financial coach is:
- Trained but not regulated
- Skilled at reviewing your overall financial situation and goals
- Able to help you develop a financial plan to achieve those goals
- Happy to discuss the pros and cons of various financial products but can’t recommend a specific one for you
- Comfortable working with anyone, whatever their situation
- Going to charge for their time
A financial adviser is:
- Regulated and authorised by the regulator to recommend specific products to clients or is independent and able to offer ‘whole of market’ solutions
- Often, going to charge an annual management fee, typically 1-2% of their client’s assets with initial fees on top.
We are proud to say that our coaching service has empowered a number of clients to reconsider their financial advisers’ offerings. From our clients’ feedback, in a number of cases, clients were overcharged, and offered unsuitable products, often due to conflicts of interest. However, this is not a rule. The best choice between a financial coach and adviser depends on an individual’s unique circumstances, including their financial literacy, time availability, comfort with managing their finances, and complexity of their financial situation.
Beginners often ask us:
- How do I reach my goals – What investments do I need to take into consideration for e.g. Taking a Sabbatical, buying a House or saving for Early Retirement?
- When should I invest – I fear that investing a lump sum in this market may have a negative impact on my returns. How can timing of buying ETFs affect my performance?
- How do I Invest – What are the pro and cons of investing with a Bank? Why should I diversify brokers?
- What should I consider investing in – What are some risks of portfolio diversifiers like Gold or Crypto?
- Avoiding Extra Costs – I have shortlisted a few ETFs, can you help me to compare them before I decide which one to buy?
- Benchmarking – What are educated investors doing in a similar situation to mine?
We are flexible. For example, answering some of these questions could help you avoid very costly mistakes:
- Challenging My Portfolio – Here is my portfolio – what am I missing? What could derail my strategy?
- Accelerating My Understanding – What are inflation linked Bonds? How are they different to Nominal Bond ETFs? What makes them outperform? Why do some investors add small cap value stocks to their portfolios? I want to exclude Tobacco companies from my portfolio – what are my options? What is Factor Investing?
- Simplifying Portfolio Maintenance – How can I diversify my investments? What is historically highly correlated so that I can consider removing it to keep my portfolio simple? How do I perform rebalancing? Does frequency matter?
- Reducing Risks – I want to understand the risks of investments – what are the different measures and how does it impact me? What are the risks of different types of brokerage accounts?
- Understanding the Impact of Recent Events – How do recent events impact my portfolio? What can I do to protect my savings from shocks?
- Investing Goals – I am investing for a specific goal e.g. Early Retirement, what is the research saying about e.g. the amount I need to have accumulated, how much can I withdraw annually? What are some calculators available and how to run them? What are the assumptions/shortcomings of these models?
- Comparing Equivalent ETFs – I have certain constraints in my tax-wrapper and can only select certain funds (e.g. I live in France and limited to specific synthetic ETFs). Which ETF characteristics should I pay attention to?
DESIGN YOUR LIFESTYLE
Personal Development
Justin Gary is an award-winning designer, author, speaker, and entrepreneur. He is CEO of Stone Blade Entertainment and creator of the innovative and award-winning Ascension deck-building game series. Explore the path less travelled, the phenomenon of magic, how analytical people can become creative people & much more!
- My Notes From Poor Charlie's Almanac (David Senra)
- Practical Reason In Ordinary Life with Professor Cass Sunstien (Rational Reminder - 1 hr 7 min)
- Intelligent v Smart - An important distinction to make in life (Collab Fund)
- How to spend for value, master your finances & getting the best out of yourself (ChooseFi - 56 min)
- What Is Happiness, Anyway? (Next Avenue)
Health & Wellness
CAREERS
From Bankeronwheels.com
From Bankeronwheels.com
Join Some Of The Smartest Investors
Do You Want to Know What Other Wise Investors Are Doing?
Our community forum has over 500 members, with decades of investing wisdom and index investing experience. Join us and get your answers.
TECH AND SCIENCE
- Maybe Bing isn't trying to compete with Google after all (ZD Net)
- AI vs. Humans: Which Performs Certain Skills Better? (Visual Capitalist)
- Revealed: The Authors Whose Pirated Books Are Powering Generative AI (The Atlantic )
- I pitted ChatGPT against a real financial advisor to help me save for retirement—and the winner is clear (Fortune)
- What note taking apps are for? (The Verge)
Travel
Cycling in Japan - 2 secret maps, best islands & seasons (Bankeronwheels.com)
Between 2019 and 2023, I spent close to a year in Japan. I cycled over 4,000 km from Hokkaido to Okinawa. Here are some tips on how you can make the best of your trip to the country of the rising sun. When to go, where to go (to avoid the touristy parts), navigation, avoiding natural disasters, and travelling cheaply.
Here are the best tips.
From Bankeronwheels.com
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(* Wheels & Dividends)
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