About Nicholas Grogan

Every year, Morningstar releases a report called “Mind the Gap,” which looks at how people invest their money and how well their investments perform. The report compares the difference in returns between investment funds and the returns earned by those investing in them. The latest report shows that investors received a 7.7% return over the

Building on the underlying concept of factor investing, we’ve already explored the Value Factor and now it’s time to look at the Size Factor. What is the Size Factor All About? Think of the investing universe as a zoo, where companies come in different shapes and sizes. Some are powerful lions, while others are nimble

Factor investing simplifies investment decisions by following golden rules such as Value, Size, Momentum, Quality, and Volatility. Let’s focus on the Value Factor and how it helps your money grow over the long term. What is the Value Factor? When shopping, you might see two identical items priced differently. If one is £10 and the

Back in the ’70s, an academic called Stephen A. Ross figured out a nifty way to give your returns a bit more oomph. He studied at famous schools like Caltech and Harvard and wrote a paper that changed how we invest. What did the paper say? He popularised “factor investing,” which simplifies investment decisions based

Investing your hard-earned money can feel overwhelming. Many choose to keep their money in the bank. With many tempting savings accounts and attractive interest rates available, some may wonder why investing matters. However, we want to explain why investing, especially in a diverse global portfolio of equities and fixed interest, is still a powerful strategy

Investors often lose sight of their long-term goals due to two main distractions: fear and hype. Fear, often brought on by global events or market downturns, can cause investors to focus too much on the short term. This can lead to hasty decisions that derail their long-term strategies. On the other hand, hype, which arises

Some believe they need to invest in more complex financial instruments to get higher returns. However, it’s important to evaluate whether these investments are necessary and will help you achieve your financial goals. What are complex investments? Complex investments are financial instruments that are more intricate in nature, come with higher risks, increased costs, and

When providing investment advice, we may discuss the idea of home bias and its potential impact. Home bias describes the tendency for investors to put a larger portion of their portfolio into assets within their own country, like stocks and bonds. For example, a UK investor with a home bias would have a higher percentage

We all wish we could outwit the financial markets. Instead of trusting them to produce life-changing returns, we fool ourselves into believing that we can predict when the market will fall and then rise again. No one is immune to this temptation, but we can cure ourselves of the desire to act on it. With a

Factor investing is a specific way to approach investing. This approach targets specific drivers of returns across asset classes and can help improve returns and enhance diversification. How does factor investing differ from traditional investing? When looking at investing styles, there are two ends of the spectrum. At one end, you have purely active managers.

We tell our clients that investing is risky. However, it is during bear markets that this becomes real. Like most fears, the best way to deal with them is to understand them, know your options, and be confident that they will pass. What is a bear market? A bear market occurs when the value of

You might not be interested or feel comfortable in choosing where your retirement savings are invested. If this is the case, then it is likely you have the money in your pension invested into the provider’s default pension fund. We are never going to criticise providers for making it easier for people to invest their

In the fourth quarter, shares in companies in developed markets (UK, US etc) continued to rally. This provided investors with the third calendar year in a row of strong positive returns. Fixed interest (Government Bonds, Corporate Bonds, etc) returns over the quarter were somewhat flat, as markets digested rising inflation and less accommodative policy from central

We have previously covered the effect that inflation might have on your financial plan. However, you might also worry about its effect on your portfolio. Most of us invest to fund future spending. If the stuff you intend to spend that money on gets more expensive and you still want to buy it, you must

Earlier this week we highlighted a report looking at another case of investors losing vast sums of money. They had put money into investments that had little hope of producing the returns being promised to them. You should always be on the lookout for scams. However, the types of investments we are talking about here

Our Investment Committee recently convened. Its responsibility is to oversee the investments we recommend. In other words, governance. An essential part of this is to review our investment philosophy which we covered in an earlier post. Our investment philosophy has developed somewhat since then, but the central pillars remain the same. What is your investment

Economic growth Signs of slower growth than some had originally expected, amid supply constraints and a Covid-19 resurgence, have led to lower growth forecasts for the United States. Expectations are that the US should reach its pre-pandemic growth trend in the first quarter of 2022, rather than late 2021. Across the euro area, hospitalisations appear to have

Morningstar has published updated research as part of its annual Mind The Gap study on how much of market returns US investors get. The headline is those investors get 1.7% less than they should. What is the reason behind the difference? The explanation the report gives for this is that the investors mistime their buys

There are a few levels on which maintenance occurs. The start of anything we do is to review the latest research and evidence. We then decide whether we need to make changes to any of our processes. This ensures they prudently reflect the latest thinking. When we say the latest thinking, we do not mean

Your portfolio represents your future. It is only natural to want to check how your investments are doing. How often you need to do this depends on the type of investor you are. Speculators who constantly buy and sell individual stocks will monitor performance frequently, perhaps daily. Those investing for the long term with robust

Over the longer term, being on course to meet your financial goals is the true meaning of success. The first aim is to grow or at least preserve the value of your portfolio after inflation over the medium term. This may not happen each year, but over a longer period, you would hope that to

The quick answer is ‘no’ for two main reasons. The first is that few investors invest all their money into equities. You need to have a lot of intestinal fortitude and patience to do this. It is more likely your portfolio will be a mix of equities and higher-quality bonds. The second is that whatever

In today’s markets, bond yields are low and those of high-quality bonds are the lowest. In addition, they could quite feasibly crash too with interest rate rises. So why have bonds in a portfolio? It is quite straightforward. Imagine you only hold equities with a portfolio of £200,000. The economy takes a turn for the

The second quarter of 2021 has seen most major markets continue on an upward path. For once, the UK, as measured by the FTSE 100 was not the laggard, as that prize went to Japan. However, in Q2 the FTSE 100 was still behind the overall global equity performance of 6.8% in sterling terms. This