Author: Phi

Five types of investors: Which one are you?

Five types of investors: Which one are you?

14 Jan 2017 |

In previous posts we considered informed and uninformed market participants. We then introduced another type of participant which we called the foolish investor. In an attempt to outperform the market foolish market participants actively trade to their own detriment at inefficient prices. Here we refine our definition of foolish market participants by dividing them into three groups: the gamblers, the deluded traders and the irrational traders. Each group is foolish in a different way.

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Why high-frequency traders are here to stay

Why high-frequency traders are here to stay

25 Oct 2016 |

Replacing continuous time trading with frequent batch auctions substantially mitigates the advantage that latency arbitrageurs, such as high-frequency traders, enjoy. Discrete time trading reduces the number of races to the top of the order book. It does not altogether reduce the advantage latency arbitrageurs have though.

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Does high-frequency trading benefit investors?

Does high-frequency trading benefit investors?

12 Oct 2016 |

Market participants can have a variety of legal competitive advantageous in public security markets. One of the more controversial ones is speed which is exploited by high-frequency traders (HFTs). Should the activities of latency arbitrageurs, such as HFTs, be curtailed or are they beneficial to markets?

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The Education of a Value Investor – Guy Spier

The Education of a Value Investor – Guy Spier

22 Aug 2016 |

This is an inspirational autobiography of Guy Spier’s career and how he turned from an investment banker into a “value” investment professional managing his own fund, Aquamarine Capital. It is inspirational because Mr Spier not only describes his pursuit to become a true value investor, but also his quest to become the “best person that he can be”.

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Why deflation when there is quantitative easing?

Why deflation when there is quantitative easing?

20 Jun 2016 |

Inflation has been declining steadily in the developed world since the peak reached in the mid-1970s. This drop can be attributed to central bank policies and globalisation. For example, moving production to areas with lower labour costs resulted in a decline in the price of goods. However, deflation has now become a major concern for developed markets.

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