Real investing isn’t like collecting stamps, coins, art, or whatever. It is less about the pieces and more about how they work together towards a total return relative to risk.
Many investors simply gorge on hot companies garnering headline hype. Others focus on personally favoured regions, sectors or styles. Some just do something naive, like “low P/E” (price/earnings ratio).
My advice after five decades of running money professionally? Start by benchmarking – selecting a broad, global stock index to measure your portfolio against.
This not only provides a measuring stick for gauging performance, it also renders a blueprint for capturing the world’s full economic bounty. Let me show you how and why.
Otherwise, you will invite haphazard approaches – and stealthy risks.
How do you know if you own too much or too little of a sector? Or if your portfolio’s swings are benign wiggles or warnings of excessive risk?
How can you tell if you are positioned to capitalise on economic conditions you expect? Without a good comparative gauge the answers are guesses.
Enter benchmarking. A broad, global stock index like MSCI’s ACWI (All-Country World Index) reveals the global composition – letting you tailor your portfolio accordingly to underweight or overweight categories.
The ACWI includes stocks from 23 developed and 24 emerging markets, representing the vast majority of global stocks. Its sector, industry and country weightings are easily accessible through MSCI’s website and is updated monthly.
Crucially, the index is capitalisation-weighted – the greater a company’s market value, the greater weight its stock gets in the index – like the real world. Sensible!
Some indexes, including the oldest, the US Dow Jones Industrial Average, instead weighs holdings by share price. Same for Japan’s hallowed Nikkei 225.
Avoid them! Share price has no connection to true economic or market might, so price-weighted indexes often diverge sharply from the realities they supposedly represent.
Often, they exclude important but high-priced stocks because they would skew the index!
When we think of “The Market”, we envision a broad cap-weighted index like the S&P 500. I favour fully global ones.
Local indexes are subject to sector skew, particularly smaller markets. The world? ACWI market cap is just 16 per cent financials, 2 per cent real estate and 1 per cent telecom.
Even big regional markets are prone to serious skew. The eurozone tilts towards financials (18 per cent of market cap), industrials and consumer discretionary stocks (16 per cent each versus the world’s 10 per cent and 11 per cent, respectively).
Australia’s market is one-third financials and a quarter materials – five times the world’s.
Japan? Abundant industrials (23 per cent) and autos (11 per cent versus the world’s 3 per cent). Even the enormous US market is skewed – tech is 28 per cent of its market cap versus the rest of the world’s 11 per cent.
Using a global benchmark can mean you outperform narrower indexes, but won’t always.
Regional skew brings big booms … and busts. But, over the long haul, cap-weighted indexes’ returns should cluster narrowly.
Why? Good old supply and demand, which bars any one category from permanent leadership.
Consider: when a particular category gets hot, demand soars. Investment bankers stoke share supply to meet demand … but typically overshoot. Over years, supply outpaces demand, turning leaders into laggards. Rinse and repeat.
While bigger, broader, global benchmarks may not bring higher returns, their diversification smooths returns – and reduces risk – a big bonus. Less extreme returns mean less temptation to make emotional decisions.
After choosing a global benchmark, adjust your portfolio based on your visions.
First, do you envision a bull or bear market ahead? If you expect more of a bull market – like I do now – own slightly more of categories you expect to lead than your benchmark does … and less of projected laggards.
For me, that now means overweighting tech and big growth stocks and underweighting defensive categories – utilities, health care and staples.
Compare your performance with your benchmark’s to gauge your tilts as deft or daft.
Don’t deviate too far – you (and I) could always be wrong! Huge tilts lead to huge risk. Your benchmark is your guide to staying diversified.
Expecting a bear market? Then you might deviate drastically, decreasing equity exposure.
But beware – for investors requiring equity-like returns, ditching stocks is the riskiest move.
Do so only if seeing a huge approaching negative nearly everyone misses – not headline worries whose ubiquity assures they are already largely priced in the market.
Correctly identifying such sneaky shocks is hard – and rare.
Forget outsize, risky bets. Good investing hinges on small, tactical tilts that keep you exposed to a big, beautiful global market without ramping up risk. A good benchmark lights the way.
Ken Fisher is the founder, executive chairman and co-chief investment officer of Fisher Investments, a global investment adviser with $200 billion of assets under management.
UAE currency: the story behind the money in your pockets
Conflict, drought, famine
Estimates of the number of deaths caused by the famine range from 400,000 to 1 million, according to a document prepared for the UK House of Lords in 2024.
It has been claimed that the policies of the Ethiopian government, which took control after deposing Emperor Haile Selassie in a military-led revolution in 1974, contributed to the scale of the famine.
Dr Miriam Bradley, senior lecturer in humanitarian studies at the University of Manchester, has argued that, by the early 1980s, “several government policies combined to cause, rather than prevent, a famine which lasted from 1983 to 1985. Mengistu’s government imposed Stalinist-model agricultural policies involving forced collectivisation and villagisation [relocation of communities into planned villages].
The West became aware of the catastrophe through a series of BBC News reports by journalist Michael Buerk in October 1984 describing a “biblical famine” and containing graphic images of thousands of people, including children, facing starvation.
Band Aid
Bob Geldof, singer with the Irish rock group The Boomtown Rats, formed Band Aid in response to the horrific images shown in the news broadcasts.
With Midge Ure of the band Ultravox, he wrote the hit charity single Do They Know it’s Christmas in December 1984, featuring a string of high-profile musicians.
Following the single’s success, the idea to stage a rock concert evolved.
Live Aid was a series of simultaneous concerts that took place at Wembley Stadium in London, John F Kennedy Stadium in Philadelphia, the US, and at various other venues across the world.
The combined event was broadcast to an estimated worldwide audience of 1.5 billion.
How tumultuous protests grew
- A fuel tax protest by French drivers appealed to wider anti-government sentiment
- Unlike previous French demonstrations there was no trade union or organised movement involved
- Demonstrators responded to online petitions and flooded squares to block traffic
- At its height there were almost 300,000 on the streets in support
- Named after the high visibility jackets that drivers must keep in cars
- Clashes soon turned violent as thousands fought with police at cordons
- An estimated two dozen people lost eyes and many others were admitted to hospital
Killing of Qassem Suleimani
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The specs
Engine: 3.0-litre six-cylinder turbo
Power: 398hp from 5,250rpm
Torque: 580Nm at 1,900-4,800rpm
Transmission: Eight-speed auto
Fuel economy, combined: 6.5L/100km
On sale: December
Price: From Dh330,000 (estimate)
What are the influencer academy modules?
- Mastery of audio-visual content creation.
- Cinematography, shots and movement.
- All aspects of post-production.
- Emerging technologies and VFX with AI and CGI.
- Understanding of marketing objectives and audience engagement.
- Tourism industry knowledge.
- Professional ethics.
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(In2Musica)
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Director: Guy Ritchie
Stars: Colin Farrell, Hugh Grant
Three out of five stars
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Company%20Profile
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MATCH INFO
Crawley Town 3 (Tsaroulla 50', Nadesan 53', Tunnicliffe 70')
Leeds United 0
THE SPECS
Engine: 1.5-litre turbocharged four-cylinder
Transmission: Constant Variable (CVT)
Power: 141bhp
Torque: 250Nm
Price: Dh64,500
On sale: Now
AndhaDhun
Director: Sriram Raghavan
Producer: Matchbox Pictures, Viacom18
Cast: Ayushmann Khurrana, Tabu, Radhika Apte, Anil Dhawan
Rating: 3.5/5
Quick pearls of wisdom
Focus on gratitude: And do so deeply, he says. “Think of one to three things a day that you’re grateful for. It needs to be specific, too, don’t just say ‘air.’ Really think about it. If you’re grateful for, say, what your parents have done for you, that will motivate you to do more for the world.”
Know how to fight: Shetty married his wife, Radhi, three years ago (he met her in a meditation class before he went off and became a monk). He says they’ve had to learn to respect each other’s “fighting styles” – he’s a talk it-out-immediately person, while she needs space to think. “When you’re having an argument, remember, it’s not you against each other. It’s both of you against the problem. When you win, they lose. If you’re on a team you have to win together.”
Gothia Cup 2025
4,872 matches
1,942 teams
116 pitches
76 nations
26 UAE teams
15 Lebanese teams
2 Kuwaiti teams
Kill%20
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Director: Ali Abbas Zafar
Starring: Salman Khan, Katrina Kaif, Sunil Grover
Rating: 2.5 out of 5 stars
The biog
Age: 46
Number of Children: Four
Hobby: Reading history books
Loves: Sports
BIGGEST CYBER SECURITY INCIDENTS IN RECENT TIMES
SolarWinds supply chain attack: Came to light in December 2020 but had taken root for several months, compromising major tech companies, governments and its entities
Microsoft Exchange server exploitation: March 2021; attackers used a vulnerability to steal emails
Kaseya attack: July 2021; ransomware hit perpetrated REvil, resulting in severe downtime for more than 1,000 companies
Log4j breach: December 2021; attackers exploited the Java-written code to inflitrate businesses and governments
The specs: 2018 Audi RS5
Price, base: Dh359,200
Engine: 2.9L twin-turbo V6
Transmission: Eight-speed automatic
Power: 450hp at 5,700rpm
Torque: 600Nm at 1,900rpm
Fuel economy, combined: 8.7L / 100km
