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Dumb, dumber…

05 August 2004 Angelo Coppola

(01.08.04) Investor behaviour, says Anil Thakersee from Old Mutual, is a subject of great research and debate, and even the very clever cant match the investment returns of the S&P over 15 years.

For example the S&P returned compounded annual returns of 15.5%, while the Mensa investment club in the USA achieved just 2.5%.
 

More importantly Thakersee says that the investment return is far more dependent on investor behaviour than on fund management.
 

And in case you didn’t know this, research has found that investors pour cash into funds as markets rise; they scramble out of the funds as the markets fall; and on average stay in the market and fund for less than three years.
 

And perhaps more worryingly investors tend to chase the flavour of the day or month and year.

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Do you believe this is the toughest period for financial advice in many years?

ANSWER

Yes, it’s hard to navigate the challenges and difficult to adapt. I’m struggling.
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50/50. I just feel like whether we like it or not, we have to ready ourselves for change… be resilient and scale for the future. It’s not about survival of the fittest anymore but survival of the quickest. We just have to move on with life.
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