


The Investing Demystified video series is based on the premise that most investor can’t beat the market (or pick investment funds to do so for them). Those investors should only buy world equity index trackers for their equity exposure, and can easily implement the simple and cheap portfolio tailored to their risk profile. They will most likely be far better off in the long run as a result!
After this video you will hopefully better be able to understand how hard it is to outperform the market, and how liberating it is to accept that you can't. But you will hopefully also appreciate that you are unlikely to do any better by selecting an investment fund / mutual fund to do so for you as only 1 out of 10 of these outperform their index over a 10 year period.
It sounds almost too simple, but your entire equity exposure can be done via only one investment, namely the world equity index tracker. This is the last free lunch in investing: you get maximum diversification at the minimal cost. Since we are not paying anyone to be smart about beating the market (we don't think we can do it) there is more money left over for us. Over time, this will matter hugely!
We now know that (a) we can't beat the market, and (b) we can have our equity exposure through a world equity index tracker. But after this video we appreciate that by combining the equity investment with the lowest risk investment we can find, we are creating a perfect portfolio for us that captures our individual attitude towards risk. If you want more risk, do more equities. If you want less risk, do more of the low risk asset. Finance does not have to be harder than that!
Hopefully we now know what we are meant to do. For me this is like reading about a great diet, then having a piece of chocolate and promptly forgetting about it all. Please don't be like me. This video should help you take the steps required to actually go about implementing the portfolio. If you are still hungry for more information I'd recommend buying my book, "Investing Demystified".
Lars Kroijer’s investing video series. This course is based on the premise that you are highly unlikely to beat the market, or to be able to pick an investment fund that outperforms the market consistently for you, which only 1 out of 10 funds do over a ten year period. We explain why accepting this premise is important, and then walk through the theory behind this investment philosophy, and how there is a super simple, cheap and powerful alternative way to manage investments that don’t imply that you are somehow an investment superstar. The course is based on a practical implementation of optimal portfolio theory.
You only need to buy only cheap world equity index tracker plus low risk asset and think about your risk personal risk levels. The course will also help you avoid paying large unnecessary fees to the financial sector and highly likely leave you much better off in the long run. The course also describes how you can implement the cheap and optimal portfolio from a practical perspective using index tracking investment products like ETFs that are available to virtually all investors, and thus avoid the much higher fees of the mutual fund industry.
The structure of the course is as follows:
1. Introduce the concept
2. Convince investors of the low likelihood of being able to beat the markets
3. Explain why you only need one world equity index tracker for your equity portfolio
4. Outline how a portfolio combining this equity exposure with a low risk asset in proportions to suit your risk profile is the simplest and best portfolio for most people.
5. How you actually go about implementing the portfolio with specific examples of products.
This course is useful for anyone with savings and investments who is thinking about pension, retirement, or simply securing their financial future, and generally worry about the best way to manage their assets. It is a short 30+ minute course with some backup material and ultimately the concepts are described in great detail in Lars Kroijer’s book on the topic, “Investing Demystified” (Financial Times Publishing). More on Lars Kroijer's homepage