Winning a loser’s game

Are we at peak passive? As everyone discusses adopting a passive investment approach, might there be a bubble in the passive market?

Most active managers have underperformed the main world indices because it was too dangerous to invest so much in seven magnificent technology companies. The idea of that level of concentration runs counter to the idea of a well diversified portfolio. And the magnificent seven have, for the most part, been less than magnificent this year, down by -4%. While some are up around 20% others are down by over -20%. A rather more magnificent stock is CVS, a US pharmacy and benefits provider, which is up 53% and a magnificent continent that is Europe, up 26% for the year to date. All these figures are in US Dollars, so deduct 10% to covert to Sterling. Sometimes catching the right falling (or rising) knife can be just too stressful. At Yoke we can help you find both active and passive solutions, providing you with cost effective support to suit your budget whatever you decide.

But if you have been distracted by Wimbledon, then you might be interested in Charley Ellis’ top Tennis Tips (Charlie is a legend in investment circles having founded Greenwich Associates):

• Serve the same serve twice, never a strong one then a weak one. It provides consistency and impresses your opponents

• Return twice and win every set

• Return three times and win every point.

• Feel comfortable with 80% of your serves going in.

 It’s almost a passive approach.