29 January 2014

Problems of the Rich - if careless when choosing financial advisors

Anyone who thinks that being rich do not also mean that one has more responsibilities should read this court document with details about the relationship between a wealth author and her advisors.

Safe Deposit Boxes are not 'safe'

Most ordinary and law-abiding citizens have no idea how much an unaccountable clique of professional politicians has already undermined all notions of justice and freedom. So just consider a few facts about a raid on safe deposit boxes that took place in London in 2008. Given that Britain is still a country whose legal system is held in high regard you may just imagine how your assets may be treated in other countries.
Aside from those three dozen or so people found guilty, the vast majority of the 3,500-plus box owners have turned out to be innocent. Yet their money was confiscated, and in many cases is still being held, by the Metropolitan Police or the Inland Revenue. The owners have spent nearly three years and thousands of pounds in uncompensated legal fees having to justify why they kept their personal belongings in safety deposit boxes and how they came by them in the first place. Worse still, when people have had their belongings returned, in some cases cash and jewellery has been missing. (London Evening Standard)
So readers should be careful about where they keep their wealth. We always advise to diversify holdings as much as possible with respect to geographical location and custodian.

23 January 2014

Have no illusion about investing in IPO's

Investors often think that IPO's allow them to invest in the company at the start. But the reality is that they are at the very end of the food chain, after founders, venture-capitalists and investment bankers have cashed in by buying their stakes at much lower prices early on in the history of the company.

17 January 2014

Keep your Investment Approach simple!

While this article is written with institutional investors in mind the lessons that can be learned from it apply to the Individual Investor as well. Keep your investments simple, make sure your risks are properly monitored and your management fees are kept as low as possible.

14 January 2014

Buyer beware! Investor beware!

Any situation where investment advice and investment execution are in the hands of the same firm an investor deals with creates conflicts of interest. If an investor wants to follow his own opinions he should do business through an 'execution-only' broker, preferably an online broker. Alternatively, the investor should give full discretionary authority to the investment manager of his/her choice and let them get on with it. Careful scrutiny of past performance records (documented and fully audited) is essential as is regular monitoring and benchmarking or performance.

9 January 2014

Expert Watch - Stating the Obvious

Readers know that I am sceptical with regard to the value of market opinions pronounced by 'experts'. While some predictions are invariably turning out to be correct this should surprise no-one. Usually expert opinion is split and by definition that means that some forecasts will be in the right direction.

6 January 2014

Useless Economists - IMF, Reinhart and Rogoff

Crazed Economists and their supporters in Politics and Economists have successfully promoted theft as a major policy tool by promoting the ideology of 'Quantitative Easing' (Money Printing to you and me). Now two proponents of this useless guild (as Nassim Taleb would describe economists) go one step further and promote outright theft by direct expropriation of bank account balances. And all this under the auspices of that empire of bureaucratic excess and lavish perks, the taxpayer funded IMF. Urgent and drastic measures to preserve one's wealth should now priority for any rational investor.