Featured and Latest Posts
Passive in Name Only? Why ‘Passive’ Funds Might Not Be So Passive After All
In theory, passive investing is simple: track the market, minimise costs, and remove human judgement. But in practice, things aren’t so clear-cut. From index selection and portfolio construction to fee differences and persistent return gaps, many so-called passive funds involve more active decisions than most investors realise. This post explores the blurred line between active and passive — and why understanding that distinction could make a big difference to your long-term returns.
How Often Should You Rebalance Your Portfolio?
How often should you rebalance your portfolio? While many investors treat rebalancing as routine, research by Jeremy Siegel suggests that leaving portfolios untouched—particularly when it comes to broad indices like the S&P 500—can actually lead to superior long-term returns. This post explores the trade-off between managing risk and letting winners run, and asks whether doing less might sometimes achieve more.
The Hidden Costs of Indexing: What Investors Should Understand
Index funds like Vanguard’s VTI are often praised for their low fees, transparency, and diversification — and for good reason. But beneath the surface of these low-cost strategies lie hidden frictions that can quietly erode investor returns. This article explores the lesser-known costs of index investing: from forced trading and front-running to adverse selection and sector concentration. It also highlights how Dimensional Fund Advisors (DFA) takes a smarter, more flexible approach — using patient, systematic trading to avoid these inefficiencies and deliver more cost-effective exposure to the market. For investors who want to stay passive but get more from their portfolios, understanding these hidden costs is key.
Does Owning Lots of Funds Actually Improve Diversification?
Many investors assume that holding lots of different funds automatically means better diversification — but that’s not always true. This post explores why the number of funds you hold matters less than what’s actually inside them, when a single fund can be enough, and how true diversification is more about uncorrelated exposures than fund count.
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.