Two Investing Lessons from the U.K.

The following video is by Sensible Investing.TV based in the United Kingdom.  The video addresses two key lessons learned from academic investing research according to Professor Jens Hagendorff  from the University of Edinburgh.  The first lesson is that it pays to have a diversified portfolio, not only in asset classes but in geography (meaning investing in many different countries).

The second lesson is that on average, it is not possible to beat the market.  So, if you want to enjoy maximum benefit from diversification and avoid taking excessive risk, Professor Hagendorff says the answer is to invest passively.

In other words, you should use funds that simply track an asset class index – capturing market returns at the lowest possible cost.   As you will see, the lessons are the same across the pond. Watch below for this interesting video:

 

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The foregoing content reflects the opinions of Crimmins Wealth Management and is subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that the statements, opinions or forecasts provided herein will prove to be correct. Past performance may not be indicative of future results. All investing involves risk, including the potential for loss of principal. There is no guarantee that any investment plan or strategy will be successful.

About Maureen Crimmins

Maureen Crimmins is co-founder of Crimmins Wealth Management and a fee-only independent financial advisor. Have a financial question? ASK MAUREEN

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