Is peer-to-peer lending something for us?

Do you remember our recent post “There is no free lunch” and how we have learned that if something looks too good to be true, then it IS too good to be true?

When it comes to investing in p2p loans, and especially those with buyback guarantee, we have a bit of the same feeling. We are very curious about the product, but we are at the same time looking for the catch in what we immediately think is too good to be true (loans with a high return and promised buy-back guarantee?!). After researching the product for some time we have chosen to give it a shot and as you could read in our last portfolio update (Portfolio update – April 2018) we have now invested 10.000 DKK (USD 1.600) in p2p loans via the platform Mintos.

Extraordinary investment opportunities – Part 3


Renting out houses and apartments has been around for ages, so this should be no extraordinary investment. Innovation within the accommodation industry has been limited over the years where renting out “empty” apartments/houses on a monthly basis has been the dominant business model. If you wanted a shorter stay you would look for a hotel room or a hostel.

But bim bam boom! A unicorn appeared – AirBnB! It shook up the industry and created opportunities for the happy treasure hunters!

Extraordinary investment opportunities – Part 2

The right stocks!

Wait! – Before you close this post and go back and admire your auto invest low cost index fortune take notice that we didn’t just write stocks, but wrote the right stocks.

Okay so this one will probably be one of the extraordinary investment opportunities that will be hardest for you to apply to your own life. Nevertheless we have to mention stocks as the stockmarket is a wonderful thing that have created many fortunes. The only little problem with the stockmarket is that at first sight it doesn’t fit any of the characteristics for extraordinary investment opportunities that we set up in our last post Extraordinary investment opportunities – Part 1. The stockmarket seems neither new or rare and it is very accessible for the public and highly scalable. So basically the worst place to look if you want to find something extraordinary. At least on an aggregated level. The exiting part about the stockmarket when looking for extraordinary returns is however its fragmentation, variation and dynamic behaviour!

Extraordinary investment opportunities – Part 1

“You can only get high returns on your investments if you are also taking a higher risk” Is that true? Or are there potential loopholes?

It seems more and more people are getting introduced to the efficient markets hypothesis in some form or another. There is as such a common understanding that you can only obtain higher returns by taking more risk.

As educated in finance we have been taught about efficient markets as well – and actually almost believe it. If there was an investment that was better than other investments the money would flow to it and wash away the extraordinary returns in a splitsecond right? But do we actually live in a world where the Eye of Sauron watches all financial options? Wether you we believe it or not we will use this post and its follow ups to challenge this view.

The fees you actually pay for index funds

As we started writing this blog, we also started reading other blogs about personal finance and FIRE. The blogs are all very different, but it seems as if they all agree to one thing… that investing in passive index funds is the shit! And we are not to blame them, as it very easily gives you a diversified portfolio at a much lower cost than buying actively managed mutual funds. But are the passively managed funds so cheap at all?

As readers of our blog know, we prefer to “invest like an index fund” rather than invest in an index fund (Single stocks or index funds?). The main reason for this is costs. Cost structures for buying single stocks is extremely easy to understand, as it is the commission fee you pay when you buy and sell the stock.

Single stocks or index funds?

Investing in the stock market can be daunting so actively managed mutual funds has traditionally been the go-to vehicle for the average Joe who wants an easy peasy investing solution. Index funds (passive funds and ETFs) have however become very popular in the recent years due to their lower costs (read more about the impact of fees here) and their simplicity and transparency. Some people however still think the costs are too high and some nationalities are restricted due to unavailability of funds or unfavourable taxation. A way around these issues is to buy the stocks yourself and invest like an index fund.

Afraid of buying stocks at the wrong time?

Are you afraid of buying your stocks when the market is at its highest? If you are a longterm investor, that mostly buy stocks, our perspective at stock buying might inspire you.

The market goes up and down all the time, but in the long run (let’s say 10-20 years) the market has historically always increased. As an investor you will not have the ability to forecast how the market will move tomorrow or in the future (and if you can, stop reading this blog and invest some money instead), which is why you will never have a chance to know whether you buy a stock when the market is at its highest or lowest. Our strategy to overcome this issue is to buy our stocks with a somewhat fixed frequency. At the moment we aim for buying approx. one new stock per month, instead of buying five new stocks in one month and then wait maybe half a year before investing again. By doing so, we do not risk investing in five stocks just before a large drop in the market. By investing in only one stock each month we might have invested once when the market was at its highest but would maybe have gotten the four other ones cheaper. Off course this also goes the other way around, so that you find out you should have bought all five stocks in the same month because it was the cheapest time to buy. But if you want to eliminate some risk, you can do as we do.

Why you should not be afraid of picking out stocks

Some people get a thrill trying to pick the right stocks, but the majority are afraid they will pick the wrong ones. But here is a statement: As long as you invest in a market ruled by professionals, you will always buy a fair priced stock. To understand this statement, you have to understand how share prices are set and who affects them.

Who affects share prices?

Certainly not you and me when we are talking larger stocks. Of course we cast our votes with our money, but we at too small to matter in the big market. A lot of people let an investment professional manage their funds instead of trying to do so themselves. This causes that the most successful and thorough professional investors often obtain control over large sums of money and thus more power to determine what the share prices should be.

Even small costs take a big bite of your investments

When I was younger and first heard about investing I thought: “Wauw, this concept of my money working for money instead of me working for money is so smart that I’m probably not smart enough to do it”. But I considered myself smart enough to not just let anybody do it, so I went online and researched the different investment funds. After thorough googleling (wauw such skillz, huh?) I ended up picking a somewhat local fund based on past performance.

Was I as smart as I thought with this past performance research? The fund performed like its benchmark, but the costs made sure that I didn’t!

When should I start investing? – Early!

Have you ever thought: “I’ll start investing in a few years when I have more money.”? If you have, you are cheating yourself! Read this and find out why it makes sense to start now.

A lot of people postpone the start of their investments because they believe that they will earn more money later in life. They can therefore justify themselves to wait and thus instead use a little extra on house, car, clothes, etc. right now. This is a priority and we are not able to say if you are happier to spend the money now or wait. However, in this post we will try to motivate you to start investing early in your life using a small example. What we would like to show is that one of the most important factors of an investment is time.