Perspectives
Budget Response to Corona
March, 2020
It seems John Maynard Keynes is making a comeback in the unlikely form of Rishi Sunak, the new Chancellor of the Exchequer. Mr Sunak’s budget is a sharp reversal of the approach taken by recent Chancellors, most obviously, George Osborne, but it is really a return to the economic orthodoxy that prevailed before the word […]
Coronavirus Downgrades to Growth
March, 2020
Towards the end of 2019, it was clear that the economic slowdown that had commenced in the 1st quarter of 2018 and which troughed in the 1st quarter of 2019 was beginning to stabilise. Average earnings were trending higher, employment improving, albeit with a heavy emphasis on low paid work, and the trade war that […]
What it All Means
February, 2020
The recent outbreak of the Coronavirus in Northern Italy has confirmed what most experienced doctors and clinicians have been predicting: that this outbreak, although potentially less deadly than other strands, is more difficult to detect and therefore has the ability to spread more widely across the globe. The term pandemic has been readily used across […]
Bursting the Bubble
February, 2020
Investing in the public markets, you get frequent appraisals of your holdings. The daily fluctuations in prices though have nothing insightful to tell you about risk, they are the value a buyer puts on a particular investment at that moment in time. Business schools and much of the finance industry measure the fluctuations in prices […]
The Most Important Thing
February, 2020
A good idea taken to its logical extreme is often how bad ideas are conceived. There are many examples of this in fields as diverse as biology and finance. For investors, this is very important because one of the biggest threats to generating good returns is engaging in irrational competition. Why did the Irish elk […]
To ESG or not ESG, that is the question
February, 2020
Recently, there has been a lot of focus on sustainability and ESG investing, where the environmental and societal impacts of a company are factors that are considered when selecting investments. The argument is that climate change is in itself an investment risk so divesting away from unsustainable companies will improve risk adjusted returns. For long […]
Nominal and Real Returns
February, 2020
Barclays has issued the Equity Gilt Study in one guise or another continuously since 1956, providing data and analysis on long-term asset returns in the UK dating back to 1899. This long data set provides a unique picture of how returns are affected by two simple factors over time: Inflation Reinvestment of cashflows The illusion […]
A Formula for Investing
January, 2020
Most new investors want to know a quick, sure-fire formula for making money in the markets. Such a formula, of course, cannot exist. If it did, any business school purporting to teach such a formula would charge infinitely high tuition fees. Also, if enough people use the formula, it becomes worthless. Why? Because if everyone […]
Watching the News
January, 2020
There is a somewhat irrational urge by investors to always stay informed with the latest news and have well-formed opinions about their implications for businesses and the broader economy. The truth is, no one really knows how the news cycle will change; transforming what was once supposedly relevant news into obsolete opinions destined to be […]
A Decade in Review
January, 2020
The seemingly arbitrary passage of roughly 3650 days is celebrated as a decade, which is the amount of time it takes our planet to revolve around the sun 10 times. Businesses and economic cycles do not however take note of such precisely choreographed celestial marathons. The last 10 years have shown that trying to make […]