With this turbulent year coming to a close, it’s time for my annual tradition of gathering my favorite investment writing from the finance community. I started this tradition in 2017, and continued it in 2018 and 2019. This year is no exception.
Without further ado, I present my favorite investment writing of 2020:
I got a sneak peak of this blog post before it was published and I literally DM’d Morgan, “this might be the best story you have ever written. holy shit.” And I stand by those words. Nothing I say here will do it justice. Just read and enjoy.
This is probably the best post I have ever read on money and how it relates to identity. Starting with survival, transitioning to freedom, and ending with power, this piece describes how money effects us when we have too little (and too much) of it. Not only did this post help me figure out where I was on my money + identity journey, but it also cautioned me on what to avoid in the future.
I remember reading this post during the market crash in mid-March and having a bit of an epiphany. Blair was one of the first bloggers to ask those with cash on the sidelines, “If not now, when?” The question is simple, but helps explain why it is so difficult to buy stocks while they are going down.
Marc Rubinstein writes my favorite new finance blog (Net Interest) and this post illustrates why. Filled with amazing tidbits on the history of fees in the hedge fund industry, this piece is both entertaining and informative in a way that is hard to find among investment writers. I really like his style and hope you do too.
One of the most effective things a blogger can do is send a simple message to their readers and then double and triple down on that message over time. This blog post does precisely that. Michael first released his “There Are Always Reasons to Sell” chart in March 2017 and has come back to it again and again. With the swift recovery after the coronavirus crash, this idea has never been more compelling.
One of the hardest risks to manage in investing is sequence of return risk, or getting poor returns when you have the most money at stake (i.e. in retirement). While this risk is due primarily to luck, there are ways in which you can try to mitigate it. This post covers four such strategies and how they can be beneficial for those nearing/in retirement.
Kris writes a weekly newsletter that provides technical investing insights from the perspective of a seasoned options trader. I particularly enjoyed this post about finding what matters in a system and then measuring it ruthlessly because it provides a novel way of thinking about how to succeed in markets.
Speaking of retirement, this inventive post suggests that the retirement crisis in America could be partially solved if Americans weren’t so in love with their big, expensive pickup trucks. Even if you don’t agree with everything Ben says here, his math checks out and it’s an idea worth discussing.
I understand that no one wants to read another “value investing is dead” post, but this one by Lyall Taylor is exceptional. A deep dive into why value stocks have underperformed over the last decade, this post is filled with insights that would be useful to all investors.
Breaking The Market was my favorite new investment blogger last year, and he has continued to deliver in 2020. While some of his work can be more technical, this piece uses a simple analogy to explain how a portfolio can benefit from avoiding volatility. Both creative and backed by mathematics, this post should not be missed.
An honest piece on the greatest investor of all time and his changing legacy. Josh captures the essence of decline and what’s it like to watch one of your heroes fade from the limelight. Well-written and layered with emotion, this writeup on the Oracle of Omaha is one we can all learn from.
This isn’t a blog post but more of a free online book. Yes it is a long read, but ValueStockGeek does a terrific job of explaining his portfolio of choice, it’s historical performance, and why you should consider investing in a similar way. Worth your time if you want to do a deep dive into an investing style that is a bit less traditional.
Every year Drew writes something excellent that stays with me long after reading it. In 2020, Perspective was that post. Not only did it come out at the perfect time (in the midst of the coronavirus crash), but it offered a level of insight and a depth of experience that is hard to find among investment writers (myself included). If you want the wisdom of a market veteran during a market crash, this is the post to read.
My Favorite Books I Read in 2020
Despite having more time at home in 2020 than ever before, I ended up doing less reading than I normally do. Nevertheless, here are five great books I enjoyed reading this year:
- Algorithms to Live By: The Computer Science of Human Decisions (Brian Christian & Tom Griffins)
One of the best books I have ever read. Not only does this book explain some of the most popular algorithms in computer science, but it also tells you how you can apply these algorithms to optimize your life. Want to get better at dating? There’s an algo for that. Want to get better at task management? There’s an algo for that. And so forth. Anyone who enjoys the data work and technical thinking I do on this blog will be well-suited to read this book.
It’s rare for me to find new financial writers these days, but JL Collins was my pleasant surprise in 2020. While I don’t agree with all of his ideas, this book is by far the simplest financial advice I have ever read. And I mean that. He literally recommends a single fund to put your money in and that’s it. If you want a simple take on personal finance, then this is it.
- The Happiness Curve: Why Life Gets Better After 50 (Jonathan Rauch)
There are lots of studies and articles on happiness, but few of them have looked at how happiness changes over our lives. This book uses empirical research from across the globe to examine the path of happiness and why life tends to get better after age 50. I have discussed some of this research before, but if you want more, then check out this book.
- What I Learned Losing A Million Dollars (Jim Paul & Brendan Moynihan)
Why would you want to read a book on losing money? Because, as the authors state:
There are as many ways to make money in the markets as there are participants but relatively few ways to lose.
Because of this, studying how people lose money may be more important than studying how they make it. And this is what this book does. First it does it by telling an entertaining story from one of the author’s lives. Then it examines the psychological state of losing money and what you can do to avoid it.
Though I started this post with Morgan’s work, this year I find it fitting to end on it as well. While many of you have probably already read The Psychology of Money, for those that haven’t, consider it if you have any downtime this holiday season. It is an entertaining read and one that has helped me to better understand my own relationship with money. I can only hope it does the same for you.
I hope you enjoyed this year’s annual review. If you are planning on traveling for the holidays, please take the necessary precautions and stay safe out there.
Thank you for reading!
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This is post 216. Any code I have related to this post can be found here with the same numbering: https://github.com/nmaggiulli/of-dollars-and-data