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Should You Invest in IPOs?
SpaceX’s record-breaking flotation has renewed excitement around IPO investing, with potential listings from Anthropic and OpenAI likely to attract similar attention. However, an exceptional company is not automatically an exceptional investment. Historical evidence suggests that newly listed companies have often underperformed after their first day of trading, particularly where valuations already reflect extraordinary growth expectations. This article examines why the most exciting IPO stories can still produce disappointing returns, and why investors should distinguish carefully between the quality of a business and the price paid for its shares.
MPS, Multi-Asset Funds and DFMs: What Is the Difference?
Model portfolio services, multi-asset funds and discretionary fund managers are often discussed as though they are interchangeable. In reality, they describe different parts of the investment process. A discretionary fund manager makes investment decisions, an MPS applies a centrally managed portfolio across individual client accounts, and a multi-asset fund combines several asset classes within a single pooled investment.
Although each approach can provide a professionally managed and diversified portfolio, their structure affects how investments are owned, rebalanced, taxed and transferred. Understanding these differences can help investors and advisers assess which solution offers the right balance of transparency, simplicity, flexibility and value.
What Due Diligence Should an IFA Complete Before Adding a Fund to a Client Portfolio?
Fund due diligence is not about chasing recent performance. It is about understanding what a fund is designed to do, how it generates returns, who is responsible for it and what could go wrong. For an adviser, a robust process should consider philosophy, people, costs, liquidity, operational strength and client suitability, whilst documenting the reasons for selection and monitoring whether the original case remains valid over time.
Differences between the Most Prominent Index Families
A global equity tracker portfolio sounds simple: buy the developed world, add emerging markets, and you have covered most of the investable equity market. But the words ‘developed’ and ‘emerging’ do not mean exactly the same thing to every index provider. South Korea, Poland, Peru and Vietnam can sit in different places depending on whether the fund tracks MSCI, FTSE Russell, S&P DJI, Solactive or STOXX. For investors combining separate developed and emerging markets funds, that can create accidental gaps, overlaps and meaningful tracking error.
Good financial decisions aren’t about predicting the future, they’re about following a sound process today.
In investing, outcomes are noisy. Short-term performance often reflects randomness, not skill. Yet fund managers continue to pitch five-year track records as if they prove anything. They don’t.
As Ken French puts it, a five-year chart ‘tells you nothing’. The real skill lies in filtering out the noise, evaluating strategy, incentives, costs, and behavioural fit.
Don’t chase what worked recently. Stick with what works reliably.