Two guides for successful investments – for beginners and advanced users

By no means is it “just” about investing, but about taking a holistic view of finances: necessary and unnecessary insurance, such as liability and occupational disability on the one hand, or mobile phone and glass breakage insurance on the other, are rather negligible.

In a pleasantly concise form, classic investments such as a current account, savings book, call money account, building society contract or unit-linked life and pension insurance are cleared away. The reason: In our world of zero interest rates, none of this brings any returns, and they are therefore poor forms of investment.

The chapter “Real estate – the rocky road to prosperity” is recommended to every follower of concrete gold. Kehl and Linke provide conclusive calculations, according to which “renting” can be more lucrative in the long term than “buying”. Here, too, it is beneficial that the authors do not side with either side, but instead offer realistic sample calculations.

From about the middle of the book it goes into the world of shares with recommendations for action: “How do I open a securities account?” to the topic of a stock market crash – with the daring thesis: “The crash as a springboard for your assets.”

What sounds lurid at first glance is explained soberly and again with example calculations: In crashes, there are more shares for the same money, which pays off more in the long run in profits in a savings plan set up for years than if the prices fluctuate less, which is easy on the nerves.

In the short term, the stock exchange is actually a “casino”. Notorious skeptics, who are still widespread, especially in Germany, are right for the time being. Because the daily market risk is unpredictable, as the Corona spring crash demonstrated impressively almost two years ago: Prices fell by around 30 percent worldwide. Apart from a few individual stocks, almost all stocks lost double-digit percentages. A deep minus for all those who invest their money in the stock market.

But, the bottom line is: “If you, as an investor, endure such fluctuations in the market, you will be rewarded with a return in the long term.” Precisely because the market has always risen in the long run. So also after the Corona crash.

However, it is just as cleanly worked out that the risks with individual stocks are higher – and are rarely rewarded with a higher return than when speculating on the overall market.
Kehl and Linke therefore recommend risk diversification via investment funds or ETFs as an ingenious “miracle weapon”. The first are managed by professionals, which costs money.

The second variant is an image of entire stock market indices. It’s easy and doesn’t cost much. The authors prefer ETFs because only a few actively managed funds manage to beat index ETFs over the long term.

For Kehl and Linke, there is no alternative to entrusting the investment to bank advisors. They are not consultants, as the job title suggests, but salespeople with opposing interests. The client’s goal is to get the most out of their money, while the advisor’s is to sell products from which the institute shares a share of the profits.

Unfortunately, what sounds like black and white painting turns out to be common practice all too often. In this respect, there is no way around self-determined financial investments.

The motto in the equity chapter is: “Your world portfolio – simplicity pays off.” ETFs from industrialized and emerging countries are specifically presented. There is no lack of conclusive and, above all, understandable explanations of how these are structured and what exactly is behind names like “Xtrackers MSCI Emerging Markets ESG UCITS ETF 1C” and is also a benefit for advanced users.

If you don’t want to give up individual stocks because the thrill is too great, the authors recommend a gambler’s second depot so that long-term success with the savings plan ETF strategy is not jeopardized. The idea of ​​the two separate depots is as simple as it is ingenious.

Anyone looking for in-depth advice on selecting individual stocks can learn from Warren Buffett. The 91-year-old stock market champion has impressively managed to beat the overall market with his share investments for decades.

About not reacting to events

Unlike his bestseller “Warren Buffett: His Way, His Method, His Strategy”, the new publication by Buffett connoisseur Robert G. Hagstrom is about the mindset of the stock market genius. To do this, Hagstrom approaches all of the people who had a significant influence on Buffett.

Much is at stake in the teachings of economist Benjamin Graham. During his mathematical and philosophical studies, he internalized the important classical works of Greek and Latin literature. In 1934 they were included in his first work, “Wertpapieranalyse” and later in “Intelligent Investieren”. Warren Buffett discovered it in 1950 and later called it “by far the best book on investing ever written.”

It is about Graham’s deep knowledge of ancient heroes, such as that of the Roman emperor and philosopher Marcus Aurelius. He ruled the Roman Empire in the second century AD. Graham, and later Buffett, were drawn to his stoic introspection. Much of this is about (stoically) not reacting to events that are beyond our control.