Risk & Volatility
What a decline actually feels like
The statistics describe the magnitude and not the experience, and the experience is what determines behaviour.
Risk & Volatility
Drawdowns, correlation, and what risk actually means to you.
Risk & Volatility
Preparing a portfolio for someone else
A portfolio that only one person understands is fragile, and the failure mode arrives at the worst possible time.
Risk & Volatility
Understanding volatility measures
Standard deviation, beta, drawdown and value at risk each measure something different, and all have known limitations.
Risk & Volatility
Correlation and why it fails when needed
Assets that move independently in calm conditions frequently move together during stress, which is when it matters.
Risk & Volatility
Stress testing your own plan
A plan that works in expected conditions is not a plan, and testing it against bad ones takes an afternoon.
Risk & Volatility
Currency risk for investors
It matters more for bonds than for equities, hedging has a cost, and the decision should follow the purpose of the holding.
Risk & Volatility
Liquidity risk and why it surprises people
The ability to sell is assumed until it is absent, and it disappears at precisely the moment it is needed.
Risk & Volatility
Leverage and why it magnifies both ways
Borrowing to invest raises expected returns and raises the probability of being forced to sell at the worst moment.
Risk & Volatility
Concentration risk and employer shares
Holding a large position in the company that also pays your salary is one of the most common and least examined risks.
Risk & Volatility
Sequence risk and why it matters at retirement
The order in which returns arrive is irrelevant while accumulating and decisive while withdrawing.
Risk & Volatility
Market falls: what history actually shows
Declines are frequent, recoveries are uneven, and the most damaging response is the most natural one.
Risk & Volatility
What risk actually means in investing
Volatility is not the same as risk, and the risk that matters is the risk of not meeting your objective.