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CNBC
11-08-2025
- Business
- CNBC
'A lot' of 'high IQ' people make this investing mistake, says money psychology expert—Warren Buffett agrees on what to do instead
It's natural to feel like being a good investor means coming up with a complicated strategy that maximizes returns, Morgan Housel, author of "The Psychology of Money," said on a recent episode of The Burnouts podcast. But that perspective is likely holding you back from long-term financial gains, he said. "A lot of people in investing, particularly smart people ... high IQ, high educated people, are like, 'Let's try to make this as complicated as we possibly can,' and they do," Housel said. But when it comes to investing, "the more complicated you make it, the worse you're probably going to do." Instead of chasing hot stocks or trying to time the market, the smartest approach to investing is making it as "brainless and simple and boring as you can," Housel said. "If you can be an average investor for an above-average period of time, like just earn average market returns every year for the next 20 years, you'll do amazing," Housel said. "The simple people who can be simple and average for 50 years are the ones who end up doing the best." One of the best tools for this approach is a low-cost index fund, which tracks a market index like the S&P 500 and aims to replicate its performance. Considering that even the world's most seasoned money managers struggle to consistently beat their benchmark indexes, investing to merely keep pace with the market is a savvy, low-effort approach, says Ben Smith, a certified financial planner and founder of Cove Financial Planning in Milwaukee, Wisconsin. It might feel more exciting to try to chase the highest returns possible, but chances are, that probably won't get you closer to your long-term goals than staying consistent with a low-cost index fund, he says. "I kind of joke to my clients, if investing is fun and sexy, you're probably doing something wrong," Smith says. "It should be kind of boring, it should be pretty easy ... You don't have to pick and choose different stocks and be really strategic, because that often doesn't work out very well, at least for most investors." Data indicates the same: Between January 2015 and December 2024, only 7% of active mutual fund managers beat their average passive rival, according to Morningstar. Warren Buffett, chairman of Berkshire Hathaway and one of the world's most successful stock market investors, has long been a proponent of passive investing. In a 1993 letter to shareholders, he wrote, "by periodically investing in an index fund ... the know-nothing investor can actually outperform most investment professionals." On CNBC's On the Money in 2017, Buffett reiterated similar advice: Most investors shouldn't focus on picking "the right company," he said, but rather they should consistently buy all the big companies through the S&P 500 in a "very, very low-cost way." Ultimately, owning a diversified portfolio of low-cost index funds, and holding onto them for as long as you can, will make "the most sense practically all of the time," Buffett said. Smith agrees. Beyond being easier to manage than a collection of individual stocks, index funds and exchange-traded funds enable you to harness the historical upward trend of the market, while reducing the risk that a decline in any single investment could derail your portfolio's returns. Plus, when you're choosing a strategy that's low-effort and won't pressure you to constantly check the market or second-guess your selections, it'll be easier to stick by your investments for the long haul. To Housel, that's most important for achieving your long-term goals. "The question you want to ask when investing is not, 'What are the highest returns that I can earn?'" Housel said. Rather, "What returns can I keep going for the longest period of time?" Of course, it's always smart to check in with your own financial advisor before making any changes to your portfolio.
Irish Times
20-05-2025
- Business
- Irish Times
Britain sees ‘new chapter' after EU deal
Britain's declared a ' new chapter ' in its relationship with the European Union, which in turn hailed the UK's new 'positive energy' towards the bloc, after the two sides struck a landmark deal over issues including trade, defence, travel and food exports. Mark Paul and Jack Power report. Mark meanwhile breaks down what is involved, and why the deal came about in the first place. Eoin Burke-Kennedy meanwhile looks at the ramifications for Ireland. Last week we saw the latest round of JNLRs measuring radio ratings. The report showed young people are listening to more than three hours of radio per day. In his column, Hugh Linehan looks at whether the survey adds up. Ciara Kelleher went on trial twice in relation to the collapse of Custom House Capital . After her last trial ended without a verdict in February, she speaks to Conor Lally about her experience. READ MORE The High Court has formally signed off on the appointment of an examiner to the company behind the Workman's Club. Fiachra Gallagher reports. As the yield on US 10 year debt hits 5 per cent, Cantillon looks at how the bond markets may box in US president Donald Trump's agenda while also looking ahead to this week's Bank of Ireland AGM and an expected pensioner protest. In Your Money, Fiona Reddan looks at who is applying for social housing . It's not always who you may expect. Dominic Coyle meanwhile resolves a reader question on and if social welfare fraud dies with the death of a person. Ryanair profits fell 16 per cent last year amid lower air fares. Barry O'Halloran and Colin Gleeson report the numbers. Barry also analyses why those lower airfares are unlikely to stay that way. 'Increasingly urgent' concern around the potential subversion of Ireland's electoral system is to be investigated by the incoming Oireachtas committee on Artificial Intelligence(AI), which is likely to feed into a forthcoming renewal of Government strategy on cyber security. Mark Hilliard reports. Revolut, the global fintech with more than 55 million customers, said on Monday it is planning to file for a banking licence in France as it aims to make Paris its western European headquarters. Joe Brennan has the story. If you'd like to read more about the issues that affect your finances try signing up to On the Money , the weekly newsletter from our personal finance team, which will be issued every Friday to Irish Times subscribers.
Irish Times
28-04-2025
- Business
- Irish Times
Improved workers' rights divide sides up North
Employers groups and trade unions in Northern Ireland will learn today how recently appointed Minister for the Economy Caoimhe Archibald intends to proceed with the proposals to update and reform employment legislation that has sharply divided employers and trade unions when she briefs the Assembly on the Good Jobs Employment Rights Bill. Emmet Malone reports. The number of companies launching on global stock markets for the first time grew by 20 per cent to 291 in the first three months of the year, a report published on Monday shows. But, as Barry O'Halloran reports, the Irish exchange has some particular challenges. Awareness of the digital euro among Irish retailers was lower than in any of eight other countries surveyed, with 44 per cent saying they had not heard of the digital euro. That compares with an average of 29 per cent across Europe. A similar percentage said they were unsure about the potential benefits of a digital euro. Eoin Burke-Kennedy looks at the on-again, off-again war of words between US president Donald Trump and Federal Reserve chairman on interest rates ahead of a crunch meeting of the Fed. READ MORE What baffles Isabel Berwick most about workplaces in 2026 is the enduring prevalence of shouty, negative and underling-blaming leadership styles. Standing in for Pilita Clark, she argues that leaders who operate a culture of fear and criticism don't get good results. Even if you don't care about 'snowflake' staff, lashing out at people is bad for business. In our Opinion slot this week, Fianna Fáil TD Martin Daly says that as Donald Trump targets universities, the State should double down on producing more PhD graduates here to ramp up our innovation and research capabilities. And as the Government confirms yet another delay in the introduction of auto-enrolment , the time has come for a dose of realism - where proper timelines and political commitment deliver a better outcome for workers with no occupational pensions. Finally, Proinsias O'Mahony says Tesla's earnings call was less a financial update than a sermon from Musk's pulpit of techno-rapture, rhapsodising about humanoid robots, trillion-dollar energy markets, and even 'heaven on Earth'. Stay up to date with all our business news: sign up to our Business Today daily email news digest. If you'd like to read more about the issues that affect your finances try signing up to On the Money , the weekly newsletter from our personal finance team, which will be issued every Friday to Irish Times subscribers.
Irish Times
24-04-2025
- Business
- Irish Times
Intel staff face more uncertainty
Intel workers face yet more uncertainty, amid reports the hobbled chip maker plans to axe as much as a fifth of its global workforce. It's the latest trouble to hit the firm's staff after what is now a years long crisis at the company. Jack Horgan-Jones has the story with the Government in the dark on the scale of any cuts here, while Stephen Farrell is on the ground in Leixlip. Mark Hilliard meanwhile looks at a timeline of the company's recent woes while Cantillon assesses how bad the hit may be for Ireland. Staying with the tech world, the EU has fined Apple and Meta a combined €700 million, stirring the ire of the two tech giants. Jack Power has the details. Away from tech, Cantillon isn't happy with pharma chiefs' suggestion the EU should allow drug prices to match US levels, while also highlighting the significance of insurers here using in house reinsurance and its impact on their Irish profits. In Inside Business, Ciaran Hancock sits down with Patrick Guilbaud, the French chef who brought fine dining to Ireland 44 years ago. READ MORE A German activist investor in Glanbia has written to the board of Tirlán Co-operative Society, the nutrition group's largest shareholder, in a bid to enlist support for a campaign for the business to carry out a strategic review after a share price slump. Joe Brennan has the story. US president Donald Trump has said he doesn't intend to fire Federal Reserve chairman Jerome Powell, but he has repeatedly criticised him for not cutting interest rates to his liking. What is Trump's beef with the Fed chief? Eoin Burke-Kennedy unpacks what is going on. Eoin also reports that the main Irish arm of computer giant Oracle has paid €730 million in cumulative dividends to its US parent over the past 18 months. In his column, Emmet Ryan looks at how companies can satisfy their demand for graduates with degrees in science, technology, engineering or maths (STEM). In Innovation, Neil Briscoe looks at a little noticed change in EU rules for carbon fibre usage in cars, and what it means for future designs, while Olive Keogh meets the man behind a Cork online grinds platform aiming to help students get top marks in maths exams. What is at stake in Meta's antitrust trial in the US? Quite a lot as it turns out. Finally, Ciara O'Brien reviews what is not your average dashcam. Stay up to date with all our business news: sign up to our Business Today daily email news digest. If you'd like to read more about the issues that affect your finances try signing up to On the Money , the weekly newsletter from our personal finance team, which will be issued every Friday to Irish Times subscribers.
SBS Australia
23-04-2025
- Business
- SBS Australia
US funds flowing to Australian markets
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