by Lars Kroijer
asset split
risk preferences
risk expertise websites
risk surveys
risk/return profile
equity markets
and financial planning, 2nd, 3rd
and long-term financial planning
minimal risk assets
adding government and corporate bonds to
pension plans
and portfolio theory
and the rational portfolio, 2nd, 3rd, 4th, 5th
rebalancing your portfolio
world equities
riskless investment choice, 2nd
S&P 500 index
and the CRB Commodity index
Index Tracker Portfolio
standard deviation
stocks
volatility
savings
‘doing nothing’ with
and long-term financial planning
life stages
SD see standard deviation (SD)
selling investments
and liquidity
software packages
Spain
government bonds
standard deviation (SD)
building your savings
and equity market risk, 2nd, 3rd
synthetic ETFs
Taleb, Nassim Nicholas
The Black Swan, 2nd
tangency points
tangible assets
tax efficient proxies
tax wrappers, 2nd
taxes, 2nd
advisers or accountants
questions to ask
benefits of the rational portfolio
capital gains tax (CGT), 2nd, 3rd, 4th
creating trading lots
and financial disaster
and pension plans, 2nd
rational portfolio adjustment
realising losses against
tax advice websites
tax efficiency and the rational portfolio, 2nd, 3rd, 4th
tax schemes
tax-sheltered or optimised products
transaction tax, 2nd
technology-focused funds, 2nd
TER (total expense ratio), 2nd
This Time is Different: Eight Centuries of Financial Folly (Reinhart and Rogoff)
total expense ratio (TER), 2nd
transaction taxes, 2nd, 3rd
transfer charges
turnover costs
unit trusts, 2nd
United Kingdom
bank deposits and credit guarantee
equities
government bonds
credit rating
earnings from
sterling investors
United States
corporate bonds, 2nd
Dow Jones index, 2nd
equity market, 2nd
risk, 2nd, 3rd
and total expense ratio
government bonds
credit ratings
dollar investors
earnings from
versus property investment
sub-prime housing market, 2nd, 3rd
Vanguard, 2nd, 3rd, 4th, 5th, 6th
FTSE AllShare index
venture capital, 2nd
Virgin FTSE All-Share Tracker fund
volatility
and financial planning
predicting future
Waal, Edmund de
The Hare with Amber Eyes
world equities
adjusting the rational portfolio
alternative weightings
defining
diversification benefits, 2nd, 3rd
ETFs
expected returns
and financial planning
50/50 split with minimal risk assets, 2nd, 3rd
investment allocation
and high risk preferences
indices
liquidity of
market value
and minimal risk assets, 2nd
overweighing ‘home’ equities
and portfolio theory
and the rational portfolio, 2nd, 3rd, 4th
allocations
risk preferences
real return expectations
US market, 2nd
‘Investing Demystified delivers, with great clarity and lucidity, the best possible advice you can get when it comes to personal investments and financial planning.’
Stéphane Guibaud, Professor of Finance, London School of Economics
‘An important book that debunks common myths about investing. A must-read for ordinary investors.’
Anita Raghavan, New York Times and author of The Billionaire’s Apprentice
‘Investing Demystified is a must read for anyone concerned about investing or protecting their hard-earned money. Although a successful hedge fund manager, Lars won’t try and tell you the next “great thing”; what he provides is a manual about how to think and act appropriately. Most professionals can’t beat the market over time, let alone individuals. This book rams home that point and sets out a clear and simple guide to becoming a rational and ultimately more profitable investor.’
Ross Westgate, CNBC
‘If you only read one book on how to manage your investments, read this one.’
Benjamin Pritchett-Brown, Investment & Pensions Europe
‘Although the financial industry’s reputation is at a low ebb, it’s important to remember that, for the individual investor, there are more high-quality, low-cost savings vehicles out there than ever before. You just need to understand how to look for them and how to put them together. Investing Demystified offers invaluable help in doing this.’
Paul Amery, Index Universe
‘In a world complicated by an over-zealous finance industry, it is refreshing to read Investing Demystified, a great and easy read that reveals the simple truth behind successful investments.’
Tets Ishikawa, author of How I Caused the Credit Crunch
‘Doing something is better than doing nothing if you want to retire in comfort. But what can we do if we don’t have an edge in the market? Lars Kroijer takes a refreshing look at how everyday people can improve their fortunes by taking some simple investing steps. But if you want to do better than that, then you will need to find yourself an edge.’
Dr David Kuo, The Motley Fool
‘In a world of the next big investment fad, Lars Kroijer takes us back to the essence of smart investing: diversify, diversify, diversify. And don’t overpay for that either.’
Coenraad Vrolijk, Managing Director of Blackrock
PEARSON EDUCATION LIMITED
Edinburgh Gate
Harlow CM20 2JE
United Kingdom
Tel: +44 (0)1279 623623
Web: www.pearson.com/uk
First edition published 2013 (print and electronic)
© Pearson Education Limited 2013 (print and electronic)
The right of Lars Kroijer to be identified as author of this work has been asserted by him in accordance with the Copyright, Designs and Patents Act 1988.
Pearson Education is not responsible for the content of third-party internet sites.
ISBN: 978–0–273–78134–9 (print)
978–0–273–78153–0 (PDF)
978–0–273–78152–3 (ePub)
978–1–292–00762–1 (eText)
British Library Cataloguing-in-Publication Data
A catalogue record for the print edition is available from the British Library
Library of Congress Cataloging-in-Publication Data
Kroijer, Lars.
Investing demystified : how to invest without speculation and sleepless nights / Lars Kroijer.
-- First edition.
pages cm
Includes Index.
ISBN 978-0-273-78134-9 (pbk. : alk. paper)
1. Investments. 2. Portfolio management. 3. Financial, Personal. I. Title.
HG4521.K745 2013
332.6--dc23
2013020569
Th
e print publication is protected by copyright. Prior to any prohibited reproduction, storage in a retrieval system, distribution or transmission in any form or by any means, electronic, mechanical, recording or otherwise, permission should be obtained from the publisher or, where applicable, a licence permitting restricted copying in the United Kingdom should be obtained from the Copyright Licensing Agency Ltd, Saffron House, 6–10 Kirby Street, London EC1N 8TS.
The ePublication is protected by copyright and must not be copied, reproduced, transferred, distributed, leased, licensed or publicly performed or used in any way except as specifically permitted in writing by the publishers, as allowed under the terms and conditions under which it was purchased, or as strictly permitted by applicable copyright law. Any unauthorised distribution or use of this text may be a direct infringement of the author’s and the publishers’ rights and those responsible may be liable in law accordingly.
10 9 8 7 6 5 4 3 2 1
17 16 15 14 13
Cover design by Kit Foster
Cover image: Shutterstock
Print edition typeset in 9/13 pt StoneSerITCStd by 3
Printed by Ashford Colour Press Ltd., Gosport
NOTE THAT ANY PAGE CROSS REFERENCES REFER TO THE PRINT EDITION
