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Tag: Odds On
The Top 5 Takeaways from Odds On
Dear friends,
It’s been 18 months since the release of Odds On, and every day since then I’ve been amazed and humbled by the response the book has generated. I could tell you some incredible stories about how Odds On is changing people’s lives by opening up the world of evidence-based investing. But the one thing that seems to resonate most with readers is how engaging and accessible the book is—how we’ve managed to humanize a topic that might otherwise seem technical and boring.
That was my goal from the start, but even after publishing the book I’ve wanted to make the lessons of Odds On even more accessible. To that end, I’ve highlighted the most important messages I hoped readers would discover in the book. Whether you’ve read it already and need a quick refresher or haven’t yet picked up a copy and are wondering what it’s all about, here are the key takeaways.
Takeaway #1. The traditional financial services industry (embodied by the giant Wall Street firms) is not about service. Wall Street is a sales machine, focused primarily on making money for itself by pushing actively-managed financial products with high fees that don’t necessarily serve the client’s best interests—or help them achieve their long-term goals.
Takeaway #2. Fortunately, there is a better way to invest. You can adopt an investment philosophy that’s based on logic, data and evidence to put the odds of success on your side. Thanks to smart academic researchers, we now understand where value comes from in the global financial markets (and where it doesn’t), and can put those findings to work in portfolios that offer exposure to the real drivers of long-term performance. In other words, investors can rely on science, not sales pitches and guesswork.
Even more heartening: Our philosophy is rapidly gaining ground against the old, sales-driven model. Just study the money moving each year into passively managed mutual funds and ETFs, as well as the flight from big brokerage houses to independent advisory firms, where true fiduciaries work in the best interest of their clients.
Takeaway #3. While the science is clear, our emotions are complicated. Human nature abhors change, and there is a lot of inertia behind investing behavior—whether we think we have to invest the way our parents and grandparents did or are still hanging on to old notions that “expert” stock pickers have the secret to long-term success. Some people can’t resist the idea that if they just read more articles about the best stocks or mutual funds or spend more time managing their investments, they’ll somehow beat the market.
But at some point you have to understand that evolving to evidence-based investing is not giving up control over your future—you’re actually taking control by accepting the science and embracing the course it lays out for us.
Takeaway #4. Even with academic evidence on your side, the world is unpredictable. Investment returns will fluctuate over time—sometimes painfully (remember 2008?). But you get rewarded precisely for taking those risks. The key to long-term success is not just embracing an evidence-based investment strategy, but staying disciplined and sticking with your plan in the face of short-term uncertainty. If you can’t do it on your own, you can work with someone who helps you stay disciplined. Remember, we’re playing the long game, and investors who are disciplined in the face of short-term chaos are the ones who are most likely to achieve their long-term goals.
Takeaway #5. Evidence-based investing improves your chances of better investment returns, but the greatest return of all is the freedom you gain. Reducing the time you spend obsessing over your investments or worrying about what’s going to happen to the markets tomorrow means you have more time to focus on what really matters to you—all those important things you’re saving and investing for in the first place. It’s liberating.
I hope these highlights have helped you understand a little more about why I wrote the book and what I believe everyone can gain when they embrace a rational, understandable investment approach. And if you or anyone else you know wants a copy of Odds On, just reach out to us by clicking below and we’ll send you one (hardback, kindle or audio). We want to change as many lives as we can, and Odds On has made that journey simpler and faster.
Thanks for taking the long view,
Matt
*All 2017 proceeds from sales of Odds On go to charity.
Welcome, Nell Swanson!
As meticulous as we are with our financial advice, we tend to be even more deliberate when adding new members to our Hill Investment Group team. Fortunately, welcoming Nell Swanson as our Chief Operating Officer (COO) was one of our easiest hiring decisions ever.
You might not immediately conclude a natural fit, given her intriguing credentials as a petroleum engineer and, most recently, an operations specialist for an oil & gas private equity firm. But here’s where it gets interesting.
Nell found us after determining that something was missing from her otherwise stellar career. She was content enough and successful enough, but she wasn’t personally connected to it or inspired by it.
So, as any good evidence-based advocate would do, she took a good, hard look around. A voracious reader with a passion for behavioral finance, it was only a matter of time before she ran across Matt Hall’s Odds On. She devoured it at once, and knew she’d found the inspiration she’d been looking for. Reaching out to Matt for career advice, the conversation quickly turned into a job interview. The rest is happy history.
“Nell blew each of us away as we met her,” says Matt. “She has so much energy and initiative, and such a rare combination of technical ability and interpersonal understanding. We soon knew we’d found the right person to be our first COO.”
You’ll find Nell based in our Houston office, where she already is making her mark by exploring new business, operational, human capital, compliance, financial and overall organizational opportunities for us. Most of all, Nell will be instrumental in helping us sustain close personal relationships with our clients even as we grow. This is mission-critical and at least as important as any numbers involved.
In her spare time, Nell is planning a fall wedding to her fiancé and pre-school classmate Walter. She enjoys working out with Walter, putting together puzzles, reading, traveling with friends and family, volunteering in her community, and drinking copious cups of coffee … cold-pressed, lightly creamed.
When she told her family about her career change, she admitted she was nervous. “They’ve always been so supportive of my past plans, I was afraid I might disappoint them by shifting gears so dramatically.” Quite the opposite, her parents felt as she did (and we do) that she should pursue wherever her passions take her. We’re so glad they’ve led her to our HIG family. Welcome, Nell!
Video Clip: Keeping It Real in Evidence-Based Investing
Is there such a thing as too much knowledge? There can be! It’s called “the curse of knowledge” when we forget that nobody will have a clue what we’re talking about if we leap right into the deep end of investment theory.
That’s why our first responsibility is to recreate those same, “ah-ha!” moments that we’ve already enjoyed. Today’s video with journalist Robin Powell does just that, for those of you who are wondering what this “evidence-based investing stuff” is all about, as well as for anyone who could use a handy, two-minute reminder. Enjoy!
Robin Powell and Matt Hall on Evidence-Based Investing from Hill Investment Group on Vimeo.
