CAPE crusaders: what’s too hot…and what’s not?

(With Stephen Moriarty) CAPE ratio & expected returns We’ve spoken at some length previously about the CAPE ratio, what it measures, and why it’s important. As noted, the US CAPE ratio is presently high in historic terms, levitating at around 30, despite the troubling outlook for the US economy. This points to only modest expectedContinue reading “CAPE crusaders: what’s too hot…and what’s not?”

Narratives versus numbers (echoes of the Nifty Fifty)

Statistics over stories – with Stephen Moriarty We all love stories. Words that describe emotions can teleport us into the world depicted in the tale, and this can lead to a form of ‘neural coupling’ with the storyteller. Investors are also naturally drawn to narratives or stories: The current frothy environment appears to have aContinue reading “Narratives versus numbers (echoes of the Nifty Fifty)”

Sticking to the principles (and avoiding recency bias)

Recency bias One bias we are all prone to is recency bias – a situation where we think (feel, really) that things will pretty much be the same and there will be no shocks or unwelcome surprises.  But markets aren’t known as the Great Humiliator for nothing. It’s usually when we least expect it thatContinue reading “Sticking to the principles (and avoiding recency bias)”

Scout’s honour (value versus growth)

The information in this blog post is general market commentary in nature only. It cannot take into account individual circumstances and does not constitute financial advice. Value versus growth We’ve discussed value versus growth previously, and we believe that ‘value’ will outperform growth over the coming cycle. Recall that growth has had a spectacular runContinue reading “Scout’s honour (value versus growth)”

Value investing through a crisis

Disclaimer: the information in this post represents general market commentary only, and does not constitute advice in any way. Too early…or too late? As we’ve been saying for a long while global stock markets have been a somewhat difficult place for investors like us who adopt a systematic approach and remain steadfast to our investmentContinue reading “Value investing through a crisis”

No, you haven’t missed out on the opportunities (avoiding FOMO)

FOMO rears its head We’ve just had a couple of years of investors and speculators becoming increasingly fearful of missing out on late cycle stock market gains. But that third or rampant speculation phase of the market cycle has now passed. Prudent investors prepared for the crash by reducing their market exposure. But some areContinue reading “No, you haven’t missed out on the opportunities (avoiding FOMO)”