Probably the biggest conundrum for Gulf investors, after deciding what to invest in, is whether to buy-and-hold through market cycles or try to time their investments.
To clarify what this means: market timers aim to buy low and sell high as a way to maximise their returns whereas the buy-and-hold investor never sells, or at least not until they need the money back, perhaps to buy a pension annuity.
Warren Buffett is the world's most successful 'value' investor as the buy-and-hold school is also often known. He developed his approach from his mentor Benjamin Graham, who wrote what Mr Buffet says is the best book on investment ever The Intelligent Investor.
It is indeed a brilliant book if a little daunting for the average reader.
But the message is pretty simple when distilled down: look to invest in excellent companies or bonds when they are cheap because they are temporarily out of favour with ‘Mr Market’ and then don’t sell or try to market time cycles because you will usually get this wrong.
What then happens is that over time the amount saved by the original cheapness of your purchase will compound, and what started as a very small advantage will multiply hugely.
This really does work.
To give a personal example, in my early years as a financial journalist I was forced into a company pension scheme that paid a very small amount into a fund, and I forgot about it for 25 years.
Then I noticed an article about new rules allowing the over-55s to cash out of UK pensions and wondered what it might be worth. My thinking was that ultra-low interest rates might temporarily boost the value of this pot.
While that was true indeed, the main growth had come from simple compounding, an amazing total 38-fold increase. If only I had invested more.
There is a lesson there: compounding will only deliver if you invest enough and early. I would add another: choose the holder of your investment very carefully as they will have to survive the course.
Warren Buffett recommends low-cost tracker funds for the S&P 500 from the likes of Vanguard.
But, of course, you don’t have to put all your eggs in one basket. Indeed, that would be another first principle to remember for successful investing.
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Read more:
Tenancy laws need a review to attract more UAE buy-to-let investors
Will new residency and company ownership rules raise UAE house prices?
Why every long-term expat should buy a property in the UAE
What makes Dubai's real estate market of today so different from 2008
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Even MrBuffett has been known to opportunistically market-time investments. He doubled his money on silver bullion in the late 1990s with a trade that lasted a couple of years. Could that happen again now?
Likewise he bailed out Goldman Sachs in the global financial crisis and let them buy him out quickly in the recovery phase.
Mr Buffett is just being smart in recommending the no-lose tracker option for the ordinary investor, who probably will not have his super-smart skills in picking big winners at the right time and price.
There are, for example, a very wealthy group of North American pensioners who have made fortunes just by copying his every purchase.
When he was bailing out Goldman Sachs, for instance, the markets were frightening but the average investor was also free to buy this stock, though admittedly not for the same price as Mr Buffett secured for his new preference shares.
But you don’t have to copy him. Indeed, the S&P tracker beat his own performance over the past decade, although not in the previous three decades.
Over the years I have made enough bad calls in financial markets to give up. We can all learn the hard way.
But I have always found it far easier to get real estate markets right and that’s where I like to invest most.
However, it is never enough just to buy-and-hold whatever the market in real estate. You still need to follow through with the original Benjamin Graham maxim and buy when ‘Mr Market is having a bad day’ and when prices are low.
Luckily for UAE investors that time is now, or shall we say the window of opportunity is wide open. Things could get a bit better for buyers, with prices dropping a little further.
But then being greedy as a buyer can also catch you out as many others will be thinking the same and when they do all finally rush to buy then prices will surely go up.
Dubai-based Mylo Real Estate wrote to me recently saying that their summer sales were running at four times the level of last year. It will be interesting to see if this claim is substantiated by the official data from the Dubai Land Department.
But in over 30 years writing about housing markets I know the green shoots of an upturn when I see it, albeit there can still be some time before what’s happening is apparent to the general market and by then it will be too late for the best deals.
Prices are at a four-year low at the moment and you have plenty of choice but it is never that easy. The best times to buy residential property are almost always in periods of uncertainty and after lengthy periods when buying would have been a bad idea.
You could hardly call the Middle East a haven of peace, stability and security at the moment but at least oil prices have almost trebled from the lows of 2014 and Opec has just agreed a new deal on output including Iran and Russia.
Putting down a deposit and gearing up with a mortgage on a property going into an upturn in the local business cycle should not be your only investment, but I would hazard a guess that it might be your best option with a three- to five-year time horizon.
Peter Cooper has been writing about finance in the Gulf for more than 20 years
UAE WARRIORS RESULTS
Featherweight
Azouz Anwar (EGY) beat Marcelo Pontes (BRA)
TKO round 2
Catchweight 90kg
Moustafa Rashid Nada (KSA) beat Imad Al Howayeck (LEB)
Split points decision
Welterweight
Gimbat Ismailov (RUS) beat Mohammed Al Khatib (JOR)
TKO round 1
Flyweight (women)
Lucie Bertaud (FRA) beat Kelig Pinson (BEL)
Unanimous points decision
Lightweight
Alexandru Chitoran (ROU) beat Regelo Enumerables Jr (PHI)
TKO round 1
Catchweight 100kg
Marc Vleiger (NED) beat Mohamed Ali (EGY)
Rear neck choke round 1
Featherweight
James Bishop (NZ) beat Mark Valerio (PHI)
TKO round 2
Welterweight
Abdelghani Saber (EGY) beat Gerson Carvalho (BRA)
TKO round 1
Middleweight
Bakhtiyar Abbasov (AZE) beat Igor Litoshik (BLR)
Unanimous points decision
Bantamweight
Fabio Mello (BRA) beat Mark Alcoba (PHI)
Unanimous points decision
Welterweight
Ahmed Labban (LEB) v Magomedsultan Magomedsultanov (RUS)
TKO round 1
Bantamweight
Trent Girdham (AUS) beat Jayson Margallo (PHI)
TKO round 3
Lightweight
Usman Nurmagomedov (RUS) beat Roman Golovinov (UKR)
TKO round 1
Middleweight
Tarek Suleiman (SYR) beat Steve Kennedy (AUS)
Submission round 2
Lightweight
Dan Moret (USA) v Anton Kuivanen (FIN)
TKO round 2
UAE squad
Rohan Mustafa (captain), Ashfaq Ahmed, Ghulam Shabber, Rameez Shahzad, Mohammed Boota, Mohammed Usman, Adnan Mufti, Shaiman Anwar, Ahmed Raza, Imran Haider, Qadeer Ahmed, Mohammed Naveed, Amir Hayat, Zahoor Khan
'The Lost Daughter'
Director: Maggie Gyllenhaal
Starring: Olivia Colman, Jessie Buckley, Dakota Johnson
Rating: 4/5
More from Armen Sarkissian
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
The Sand Castle
Director: Matty Brown
Stars: Nadine Labaki, Ziad Bakri, Zain Al Rafeea, Riman Al Rafeea
Rating: 2.5/5
NO OTHER LAND
Director: Basel Adra, Yuval Abraham, Rachel Szor, Hamdan Ballal
Stars: Basel Adra, Yuval Abraham
Rating: 3.5/5
hall of shame
SUNDERLAND 2002-03
No one has ended a Premier League season quite like Sunderland. They lost each of their final 15 games, taking no points after January. They ended up with 19 in total, sacking managers Peter Reid and Howard Wilkinson and losing 3-1 to Charlton when they scored three own goals in eight minutes.
SUNDERLAND 2005-06
Until Derby came along, Sunderland’s total of 15 points was the Premier League’s record low. They made it until May and their final home game before winning at the Stadium of Light while they lost a joint record 29 of their 38 league games.
HUDDERSFIELD 2018-19
Joined Derby as the only team to be relegated in March. No striker scored until January, while only two players got more assists than goalkeeper Jonas Lossl. The mid-season appointment Jan Siewert was to end his time as Huddersfield manager with a 5.3 per cent win rate.
ASTON VILLA 2015-16
Perhaps the most inexplicably bad season, considering they signed Idrissa Gueye and Adama Traore and still only got 17 points. Villa won their first league game, but none of the next 19. They ended an abominable campaign by taking one point from the last 39 available.
FULHAM 2018-19
Terrible in different ways. Fulham’s total of 26 points is not among the lowest ever but they contrived to get relegated after spending over £100 million (Dh457m) in the transfer market. Much of it went on defenders but they only kept two clean sheets in their first 33 games.
LA LIGA: Sporting Gijon, 13 points in 1997-98.
BUNDESLIGA: Tasmania Berlin, 10 points in 1965-66
'The Woman in the House Across the Street from the Girl in the Window'
Director:Michael Lehmann
Stars:Kristen Bell
Rating: 1/5
UAE squad
Humaira Tasneem (c), Chamani Senevirathne (vc), Subha Srinivasan, NIsha Ali, Udeni Kuruppuarachchi, Chaya Mughal, Roopa Nagraj, Esha Oza, Ishani Senevirathne, Heena Hotchandani, Keveesha Kumari, Judith Cleetus, Chavi Bhatt, Namita D’Souza.
The five pillars of Islam
1. Fasting
2. Prayer
3. Hajj
4. Shahada
5. Zakat
Griselda
%3Cp%3E%3Cstrong%3EDirector%3A%3C%2Fstrong%3E%C2%A0Andr%C3%A9s%20Baiz%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EStarring%3A%C2%A0%3C%2Fstrong%3ESof%C3%ADa%20Vergara%2C%20Alberto%20Guerra%2C%20Juliana%20Aiden%20Martinez%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ERating%3A%3C%2Fstrong%3E%204%2F5%3C%2Fp%3E%0A
Ain Dubai in numbers
126: The length in metres of the legs supporting the structure
1 football pitch: The length of each permanent spoke is longer than a professional soccer pitch
16 A380 Airbuses: The equivalent weight of the wheel rim.
9,000 tonnes: The amount of steel used to construct the project.
5 tonnes: The weight of each permanent spoke that is holding the wheel rim in place
192: The amount of cable wires used to create the wheel. They measure a distance of 2,4000km in total, the equivalent of the distance between Dubai and Cairo.
How much do leading UAE’s UK curriculum schools charge for Year 6?
- Nord Anglia International School (Dubai) – Dh85,032
- Kings School Al Barsha (Dubai) – Dh71,905
- Brighton College Abu Dhabi - Dh68,560
- Jumeirah English Speaking School (Dubai) – Dh59,728
- Gems Wellington International School – Dubai Branch – Dh58,488
- The British School Al Khubairat (Abu Dhabi) - Dh54,170
- Dubai English Speaking School – Dh51,269
*Annual tuition fees covering the 2024/2025 academic year
MATCH INFO
Liverpool 0
Stoke City 0
Man of the Match: Erik Pieters (Stoke)
At a glance
Global events: Much of the UK’s economic woes were blamed on “increased global uncertainty”, which can be interpreted as the economic impact of the Ukraine war and the uncertainty over Donald Trump’s tariffs.
Growth forecasts: Cut for 2025 from 2 per cent to 1 per cent. The OBR watchdog also estimated inflation will average 3.2 per cent this year
Welfare: Universal credit health element cut by 50 per cent and frozen for new claimants, building on cuts to the disability and incapacity bill set out earlier this month
Spending cuts: Overall day-to day-spending across government cut by £6.1bn in 2029-30
Tax evasion: Steps to crack down on tax evasion to raise “£6.5bn per year” for the public purse
Defence: New high-tech weaponry, upgrading HM Naval Base in Portsmouth
Housing: Housebuilding to reach its highest in 40 years, with planning reforms helping generate an extra £3.4bn for public finances
Company%C2%A0profile
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A little about CVRL
Founded in 1985 by Sheikh Mohammed bin Rashid, Vice President and Ruler of Dubai, the Central Veterinary Research Laboratory (CVRL) is a government diagnostic centre that provides testing and research facilities to the UAE and neighbouring countries.
One of its main goals is to provide permanent treatment solutions for veterinary related diseases.
The taxidermy centre was established 12 years ago and is headed by Dr Ulrich Wernery.
Company%20Profile
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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.
