Interest rates hikes and stocks

Interest rates hikes and stocks

Posted on December 10, 2022
September 13 was the worst day of 2022 for the US stocks until now. S&P500 lost 4.3% on that day. In fact, it was the worst day for the index over the last two years. The reason for this was higher than anticipated inflation and shattered hopes that the Federal Reserve might slow down its tightening policy in the coming months. The stock market often reacts immediately when interest rates change. Investors attempt to price in the expected consequences of rate changes. Let us explore the rationale behind the relationship between interest rates and the stock market. 

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Dollar-cost averaging vs. lump-sum investing

Dollar-cost averaging vs. lump-sum investing

Posted on August 23, 2022
We have fairly often underlined the deficiencies of market timing in our blog. In an effort to reduce the risk of market mistiming and mitigate the impact of volatility, some investors apply dollar-cost averaging. Dollar-cost averaging means investing the same amount of money at regular intervals over a certain period of time, regardless of price. This strategy eliminates the burden of trying to buy at the best price. The purpose of dollar-cost averaging is to avoid the risk of investing a large amount at a potentially unattractive price.

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Stocks as protection against inflation

Stocks as protection against inflation

Posted on August 12, 2022
Inflation has hit the headlines over the last few months. The phenomenon is worldwide. In June 2022, consumer prices in the euro area rose by 9.6% compared to the year before. This is the highest inflation rate in the eurozone’s 23-year history. In the United States, consumer prices were up 9.1% during the same period. That is the highest inflation rate in four decades. The big question for investors is: can a stocks portfolio protect them against inflation?

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Greater Fool Theory

Greater Fool Theory

Posted on July 30, 2022
Speaking at a TechCrunch talk, Bill Gates described cryptocurrencies and NFTs as something that’s “100% based on greater fool theory.” So, what is the greater fool theory and how to avoid being a fool?

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Takeaways from 2022 Berkshire Hathaway Annual Shareholders Meeting

Takeaways from 2022 Berkshire Hathaway Annual Shareholders Meeting

Posted on July 18, 2022
You probably know about Woodstock Music Festival. Now, have you ever heard of the Woodstock of capitalism? That’s what they call Berkshire Hathaway annual shareholders meeting. It's always interesting to hear from the chairman and chief executive Warren Buffett and the vice chairman Charlie Munger. We identified several topics addressed at the last Berkshire Hathaway annual shareholders meeting, which we believe will be of interest to each investor.

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