May 2015

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Buy Shares / Equities or a House?

If you take a look at what the masses are doing, and you subscribe to the opinion that the masses are more often not good investors than vice versa, then currently is a great time to sell a house and buy equities with the proceeds. In my opinion. The following graphs illustrate the issue: I found these graphs at http://zendepot.de/8-immobilien-irrtuemer-teil-1/


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(Partially) Hedging a Portfolio with Futures or Options to reduce Volatility and to a lesser extent Return

After having gone short futures for a client portfolio recently, I needed to explain what effect such a tactical decision has on the portfolio in question to the clients beneficiaries. Below is a graphical representation of what happens when you hedge part of a portfolio (in a very specific example, this would need to be calculated for each portfolio that was being considered for a hedge). Firstly the expected volatility…


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Central Banks In The Driver Seat

The Reserve Bank of Australia always has interesting comments ; “Low interest rates are acting to support borrowing and spending, and credit is recording moderate growth overall, with stronger lending to businesses of late. Growth in lending to the housing market has been steady over recent months. Dwelling prices continue to rise strongly in Sydney, though trends have been more varied in a number of other cities. The Bank is…


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Giovanni de Francisci Gets It – Wisdom coupled with good grasp of History and Psychology

That is what I thought when I watched the youtube clip (https://www.youtube.com/watch?v=r5QsIT0KjkU) of Giovanni de Francisci talking about hedge fund managers. What he said is also just as correct for simple independent asset managers. I have just come through an education programme to become a Certified International Investment Analyst (CIIA) and the amount of modern portfolio theory (MPT) and diversification talk can make people blind to the most interesting investments….