Why did we make so many wrong decisions about investing? In order to be better investors, we must be aware of the mistakes and biases that we show throughout the investment process. We cannot dissociate our behavior from the evolution of the investment portfolio.
The definition of strategy for the investment portfolio is the result of the investment policy and the formulation of expectations for the capital market. It is an iterative process that culminates in portfolio optimization, asset selection, and strategy execution.
In this article, we address some references to the analysis of strategic asset allocation in geographic terms, economic, sectoral and industrial regions and blocks, and factors and trends in each asset class. It is important to frame these different approaches.
In the article on economics and financial markets, we analyze the correlation and causality and how both influence the return and risk expectations associated with the investment portfolio. Defining the set of data and indicators to be analyzed is an essential task for building an investment portfolio suited to the objectives and preferences of each investor.
Today we address the formulation of expectations and the relationship between the economy and financial markets. While they both are concerned with money, the economy and financial markets are two distinct fields. The fundamental law of investment is uncertainty about the future. A kind of “I just know that I don't know anything".
The financial advisor is intended to help investors develop a personalized financial plan and make the best investment decisions to achieve their goals.