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December 13, 2016

Best free sources for investment advice

Thanks to the internet, there is a wealth of education available online. While it may seem hard to distill the “good” information, it is actually not that difficult. Our advice is to look at the investment process of the largest investors – after all, they have decades of experience and their approach represents current best practice. So don’t expect any hot tips but lots of advice about the right investment process. If you can control your process and your actions, over time, the outcomes will take care of themselves. We present here our favorite three sources:

1. What are institutional investors doing right now?

I worked 15 years at Credit Suisse in London and Hong Kong covering institutional accounts – from insurance companies to hedge funds and even large sovereign wealth funds. Unsurprisingly, one of the most common questions I get now that I run my own wealth advisory service is “how are these professional investors positioned?” Actually, it is no secret as many of the institutional investors publish their investment strategies. The largest sovereign wealth fund in Europe, the Norwegian Pension Fund, does so regularly and is a great source of information. In our daily work with new clients we often find that individual investors’ asset allocation is very different from the best-practice exemplified by the Norwegian Pension Fund. In short, if your asset allocation differs materially from theirs, you are doing something wrong. There is no reason to reinvent the wheel and we unabashedly copy what these large institutions do.

Link: https://www.nbim.no/

2. Why are most institutional investors running similar strategies?

Why are the investment strategies of the Norwegian Pension Fund similar to the Singapore sovereign wealth fund (here) and similar to the Church of England (here)? Why do the large funds have no exposure to gold, silver and commodities but approximately 60% in the same asset class? Because they all have access to the same historical data and they can see what works and what doesn’t. But these historical data are no secret – Credit Suisse is publishing an excellent “Global Investment Returns Yearbook” that gives a good overview over the major asset classes.

Link: http://publications.credit-suisse.com/index.cfm/publikationen-shop/research-institute/

3. What would Warren Buffett do?

Warren Buffett is one of the richest persons in the world and probably the most successful investor of the last 50+ years. Why not listen to what he says? In the Chairman Letter of the annual reports of his company Berkshire Hathaway, he gives a wealth of free investment advice. He often touches upon the three most important points: (1) what are the right asset classes, (2) what is the right investment product and (3) what are the typical investment mistakes.

Link: http://www.berkshirehathaway.com/letters/letters.html

Last but not least

Another free source of hopefully excellent investment advice is this website. If you scroll down to the bottom of this page, you can register for our free newsletter.



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