Alpha – the elixir of life for active managers and the holy grail for investors that select them. Defined as the excess returns above an appropriate benchmark or the ability to improve a portfolio’s risk profile over passive options, it captures the returns attributable to a manager’s skill. Given such skill is a scarce resource,

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Financial literacy is a complicated and often sensitive topic. In this post, I won’t cover the personal finance aspects of this area (i.e. saving, budgeting and debt management) and instead I’ll focus on the investment and retirement planning side. Understanding the long-term effects of compounding returns, management fees on investment products, and inflation can help

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One of the most common questions I get asked on ETFs relates to liquidity, largely driven by the common misconception that ETFs are somehow illiquid due to the fact that ‘on-screen’ liquidity at times appears limited (particularly compared to popular shares). Even though we have dealt with this area a number of times in other

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Over the last decade or so, beginners and experienced investors alike have turned increasingly to ETFs. The reason is simple; in the highly volatile markets across the planet in the wake of the global financial crisis (GFC), it’s both challenging to pick a winner in a single stock, and easy to miss investment opportunities as

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If you’re interested in getting a start in investing, then Exchange Traded Funds, or ETFs, may well be a great place for you to begin. Once you have a basic understanding of ETFs, you’ll find they’re a more accessible and convenient way to participate in the sharemarket, and usually at a substantially lower cost than

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Over the years, the perennial debate of the relative benefits of passive versus active management has been raging amongst personal investors, finance professionals, academics and just about anyone with an interest in investing. Although there is no doubt that this discussion will continue for years to come, it has become apparent that each management style

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ETFs have been gaining popularity with Australian investors since they first launched on the Australian Securities Exchange (ASX) nearly 17 years ago. For many SMSF Trustees, ETFs offer a combination of advantages that align well with many SMSF and retirement planning goals. For a number of SMSFs, ETFs can be a particularly useful investment option

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Recent market concerns with regard to rising bond yields has once again drawn attention to the value of floating versus fixed rate bonds in such an environment. This note provides an update on the recent performance of these two types of bond exposure. Risk and Return in Fixed vs Floating Bond Exposures  As I’ve previously explained,

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Human capital in asset allocation Most readers and investment professionals will accept that “time in the market” beats “timing the market” as the key to wealth generation over the long run. Despite this, we tend not to think too much about the accumulation process, often making investments on the assumption of a static lump sum

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As every modern day citizen can well attest, we’ve experienced real advancements over recent years. Technology is one area, for example – with the iPhone being  a classic example: you now have access to multiple services such as connecting with your loved ones for a video chat, accessing almost every song ever recorded, monitoring your

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