A round up of interesting or cool stuff I’ve read.
Hands up who guessed that stocks would rally on the announcement of a Covid vaccine?
Ok, sure, that was probably pretty obvious…
Hands up if you predicted that said vaccine announcement would occur in November, less than a year after the virus emerged in the UK.
Not so easy! (If you’ve still got your hand raised, kindly let me know the next time the markets are going to spike).
This highlights once again the difficulty in predicting what the markets will do in the short term. Although I have fun buying the occasional stock, the vast majority of my investing is simply in a global index tracker. This means that I don’t have to worry about beating the market or missing the next hot tip. Instead, I simply capture all the gains in the market, whilst saving my time and energy for other things.
Other interesting links that caught my eye this week:
- Quiet FI asks What secrets do you tell? I stumbled upon this blog through Indeedably’s I read page and was blown away by the quality and thoughtfulness. This particular post comments on the act of blogging, why people blog, and how every blogger has to decide how much of their own personal life to share with their readers.
- Tony Yates explains how governments borrow money over on Prospect magazine – If all governments are borrowing to fight Covid, who is lending?
- The Evidence Based Investor with your weekly reminder that passive > active investing. A real long-term investment strategy.
- Michelle from Fire and Wide considers a new benefit of financial freedom – Escaping Lockdown. Not jealous at all, nope, definitely not…
- Banker on FIRE predicts lower than average returns from equities going forward – Covid Vaccine? Don’t get too excited. Although, I have to say, the “real” impact doesn’t seem as bad as the headline. Nominal return is the sum of dividend yield, real earnings growth and inflation. According to BoF, this has given a return roughly equal to 10%. If inflation decreases from 3-4% to 0-1%, and the return similarly decreases to 6-7%, will we notice the difference, in terms of standard of living?
Deutsche Bank: Tax home workers ‘to help pay those who cannot’ via the BBC. Not sure I agree with this proposal by Deutsche Bank to tax homeworkers an extra 5%. I understand that a surprisingly large amount of the economy is based on serving the city workers, and that this is now at risk with the move to homeworking. However, I don’t think punishing home workers is the answer.
- An article in Economic Insights compares the role of nature vs nurture in wealth and other economic outcomes – Poor Little Rich Kids.
- The DIY Investor looks to capitalise on Biden’s election victory and the increased likelihood of a green wave of investing – Enphase Energy – Portfolio Addition.
- u/reckless-saving is running a FIRE UK Survey 2020 and is hoping to get 200+ responses by the end of November. More details on the FIREUK subreddit.
- Sign up to Trading212 via this link and we both receive a free share.
Thanks for reading. Hope you’re all having a good week.