{"id":339,"date":"2015-07-17T13:28:07","date_gmt":"2015-07-17T20:28:07","guid":{"rendered":"https:\/\/chaltenadvisors.com\/blog\/?p=339"},"modified":"2015-07-17T13:28:07","modified_gmt":"2015-07-17T20:28:07","slug":"avoid-the-noise-feel-better","status":"publish","type":"post","link":"https:\/\/chaltenadvisors.ca\/blog\/avoid-the-noise-feel-better\/","title":{"rendered":"Avoid the noise – Feel better"},"content":{"rendered":"

\"Ignore<\/a><\/p>\n

“Why copper and gold are ready to shine”<\/em><\/p>\n

“Fed rate hike fears ripple through Canada, world\u2026.”<\/em><\/p>\n

“Futures higher on Greek deal”<\/em><\/p>\n

“Bill Gross: 6 conditions for a bond crisis”<\/em><\/p>\n

“Traders don\u2019t want to hear this problem with banks”<\/em><\/p>\n

“This should concern every oil bull in the world”<\/em><\/p>\n

“Wealth secrets of the one percent \u2013 how the super-rich became uber rich”<\/em><\/p>\n

AHHHH! \u00a0How can we keep up? \u00a0The above are some of the headlines that caught my eye this morning as I scrolled through a few websites. \u00a0I try to read a bit everyday and try to share pieces that offer sensible financial planning and investment insights. \u00a0 However, it’s hard to shut out\u00a0the noise.\u00a0 I define noise to mean things that\u00a0are more likely to confuse or detract from a successful investment experience rather than improve\u00a0it.<\/p>\n

I find the noise articles often fit into one of the following categories:<\/p>\n

    \n
  1. Forecasters – accurate economic forecasting is nearly impossible. So forget about the forecasters \u2013 they won\u2019t help you.<\/li>\n
  2. Stokers of jealously, fear and greed.\u00a0 Say no to the fear and greed. \u00a0They are natural instincts that help you survive in the wild, but they won\u2019t help your investment performance and they make you feel bad.<\/li>\n
  3. Connectors of\u00a0events; eg \u2013 \u201cEuro falls because of Greece troubles\u201d \u2013 chances are tomorrow you\u2019ll read \u201cEuro rises because of Greece troubles\u201d from the same source. Ex-post connections are likely overly-simplistic and try\u00a0to find significance in randomness.<\/li>\n<\/ol>\n

    The purpose of this constant flow of information is to make you believe that unless you\u2019re in the know, you will somehow be left behind. \u00a0When it comes from the financial press, it\u2019s there to keep you riveted, eyeballs twitching and consuming advertising.\u00a0 When it comes from the financial services industry in the form of \u201cresearch\u201d or market commentary, it\u2019s designed to make you act \u2013 ie. to do something with your portfolio that somehow generates a trading commission or investment product sale.<\/p>\n

    I’m not saying\u00a0that the news is uninteresting or that keeping on top of current affairs isn\u2019t a noble pursuit. \u00a0I certainly like to stay informed and like to feel I could offer an opinion on something if asked. That\u2019s very different than believing that this is knowledge that can add to your investment performance and overall investment experience.\u00a0 It doesn\u2019t.\u00a0 It is noise designed to hold your attention and compel you to act in ways that are more likely to hurt your investment performance (ie. through excessive transaction costs or buying expensive investment products) than to help it.<\/p>\n

    What will lead to investment success is:<\/p>\n

      \n
    1. Employing a long term buy and hold investment strategy rather than\u00a0trying to outperform the market via stock picking or market timing,<\/li>\n
    2. Being adequately diversified,<\/li>\n
    3. Sensible asset allocation\u00a0based on your risk tolerance and having a disciplined rebalancing strategy, and<\/li>\n
    4. Keeping costs low.<\/li>\n<\/ol>\n

      Keeping up with news flow doesn’t help with\u00a0any of these, in fact it can only hurt you\u00a0by\u00a0making you chase performance and increasing your costs by\u00a0making more trades.<\/p>\n

      Free yourself from the noise.\u00a0\u00a0 In addition to the positive impact it will have on your investment experience, it will reduce your anxiety, and that will make\u00a0you feel better.\u00a0 Feeling better is good.<\/p>\n","protected":false},"excerpt":{"rendered":"

      “Why copper and gold are ready to shine” “Fed rate hike fears ripple through Canada, world\u2026.” “Futures higher on Greek deal” “Bill Gross: 6 conditions for a bond crisis” “Traders don\u2019t want to hear this problem with banks” “This should concern every oil bull in the world” “Wealth secrets of the one percent \u2013 how […]<\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1,17,10,7,14,12],"tags":[],"class_list":["post-339","post","type-post","status-publish","format-standard","hentry","category-all-posts","category-costs","category-evidence-based-approach","category-graham-bodel-posts","category-investment-industry-issues","category-passive-vs-active-investing"],"_links":{"self":[{"href":"https:\/\/chaltenadvisors.ca\/blog\/wp-json\/wp\/v2\/posts\/339","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/chaltenadvisors.ca\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/chaltenadvisors.ca\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/chaltenadvisors.ca\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/chaltenadvisors.ca\/blog\/wp-json\/wp\/v2\/comments?post=339"}],"version-history":[{"count":3,"href":"https:\/\/chaltenadvisors.ca\/blog\/wp-json\/wp\/v2\/posts\/339\/revisions"}],"predecessor-version":[{"id":343,"href":"https:\/\/chaltenadvisors.ca\/blog\/wp-json\/wp\/v2\/posts\/339\/revisions\/343"}],"wp:attachment":[{"href":"https:\/\/chaltenadvisors.ca\/blog\/wp-json\/wp\/v2\/media?parent=339"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/chaltenadvisors.ca\/blog\/wp-json\/wp\/v2\/categories?post=339"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/chaltenadvisors.ca\/blog\/wp-json\/wp\/v2\/tags?post=339"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}