Invest
‘Put arrogance in a box’ this financial year
The new financial year is a time to reflect, recalibrate and question whether investment decisions have been informed by wisdom or arrogance, a global portfolio strategist has said.
‘Put arrogance in a box’ this financial year
The new financial year is a time to reflect, recalibrate and question whether investment decisions have been informed by wisdom or arrogance, a global portfolio strategist has said.
Investors need to check their arrogance every so often to ensure they’re making smart decisions, State Street Global Advisors global portfolio strategist Thomas Reif told Nest Egg.
The question, “What makes you so special?” is a critical one for investors, he explained, as even professional investors can, and do, underperform at times.
“Unless you think you have a crystal ball, ask yourself, ‘What do you know that the market doesn't know?’” Mr Reif said.
“And if professional investors, guys who have done this for a living for all of their lives, can't outperform the market consistently, ‘What is so special about the idea that you have?’
“I'm not saying it's not special, but if you're looking at individual securities or individual positions, what makes you think that you know something that isn't in the price?”
In these instances, a little “modesty check” wouldn’t go astray, he said.
“Let’s put arrogance into a little box and have a look at the decisions we're making,” Mr Reif said.
He said the market tends to get it right over the long term and questioned the strength of concentrated positions potentially informed by undue confidence.
Pointing to Australia’s “disproportionate” home bias, Mr Reif warned that investors holding 40 per cent of their portfolio in domestic assets for growth have a “big weight to financials”.
It isn’t uncommon to have this weighting, he added, but the big four banks are essentially quite similar.
“If you look long-term, aside from the occasional scandal which drops the share price, they're all lending to the same population, be that corporates or individuals, they all do kind of the same thing in the long term,” Mr Reif said.
“If you're kind of buying one bank – it might well be a high-quality bank – is that representative of what's available in the world? You might want to consider investing internationally to diversify, to get exposure to things like the tech stocks out of the US or Chinese securities.”
RELATED ARTICLES
Property
Twice the demand: the case study behind Melbourne’s first‑home buyer surge
Melbourne has quietly engineered one of Australia’s most consequential housing turnarounds, with first‑home buyer demand running at roughly double the national pace and four of the top five buyer ...Read more
Property
First‑home buyers now anchor Australia’s mortgage growth — but the risk maths is changing
Great Southern Bank’s revelation that nearly one in three of its new mortgages went to first‑home buyers is not an outlier. It is the leading edge of a broader market realignment powered by government ...Read more
Property
Home guarantee scheme shake-up challenges Australia’s housing market players
From 1 October 2025, the expanded Home Guarantee Scheme (HGS) materially widens what first-home buyers can purchase and where. By sharply lifting price caps and relaxing eligibility settings, the ...Read more
Property
GSB’s first‑home buyer play: turning policy tailwinds into market share
Great Southern Bank’s latest results show that nearly one in three of its new mortgages now go to first‑home buyers—evidence of a fast‑moving market reshaped by government guarantees, easing rates and ...Read more
Property
Why investors are fleeing and renters are scrambling in Australia's housing maze
Australia’s rental market is tightening even as individual landlords sell down. New data points to a multi‑year investor retreat tied to higher holding costs and regulatory uncertainty, while prices ...Read more
Property
Australia's 5% deposit guarantee: Unlocking gains while balancing risks in the market share race
Can a bigger government guarantee fix housing access without fuelling prices? Australia is about to find out. The Albanese government’s expanded 5% deposit pathway aims to help 70,000 buyers, remove ...Read more
Property
Australia's bold move the 5% deposit scheme shaking up the housing market
Can a government guarantee replace lenders mortgage insurance without inflating prices or risk? Canberra’s accelerated 5% deposit scheme is a bold demand-side nudge in a supply‑constrained marketRead more
Property
When rates drop but stress sticks: exploring Australia's mortgage arrears dilemma
Headline numbers suggest arrears ease as rates come down. The reality in Australia is messier: broad measures dipped into mid‑2025, yet severe delinquencies and non‑bank portfolios remain under ...Read more
Property
Twice the demand: the case study behind Melbourne’s first‑home buyer surge
Melbourne has quietly engineered one of Australia’s most consequential housing turnarounds, with first‑home buyer demand running at roughly double the national pace and four of the top five buyer ...Read more
Property
First‑home buyers now anchor Australia’s mortgage growth — but the risk maths is changing
Great Southern Bank’s revelation that nearly one in three of its new mortgages went to first‑home buyers is not an outlier. It is the leading edge of a broader market realignment powered by government ...Read more
Property
Home guarantee scheme shake-up challenges Australia’s housing market players
From 1 October 2025, the expanded Home Guarantee Scheme (HGS) materially widens what first-home buyers can purchase and where. By sharply lifting price caps and relaxing eligibility settings, the ...Read more
Property
GSB’s first‑home buyer play: turning policy tailwinds into market share
Great Southern Bank’s latest results show that nearly one in three of its new mortgages now go to first‑home buyers—evidence of a fast‑moving market reshaped by government guarantees, easing rates and ...Read more
Property
Why investors are fleeing and renters are scrambling in Australia's housing maze
Australia’s rental market is tightening even as individual landlords sell down. New data points to a multi‑year investor retreat tied to higher holding costs and regulatory uncertainty, while prices ...Read more
Property
Australia's 5% deposit guarantee: Unlocking gains while balancing risks in the market share race
Can a bigger government guarantee fix housing access without fuelling prices? Australia is about to find out. The Albanese government’s expanded 5% deposit pathway aims to help 70,000 buyers, remove ...Read more
Property
Australia's bold move the 5% deposit scheme shaking up the housing market
Can a government guarantee replace lenders mortgage insurance without inflating prices or risk? Canberra’s accelerated 5% deposit scheme is a bold demand-side nudge in a supply‑constrained marketRead more
Property
When rates drop but stress sticks: exploring Australia's mortgage arrears dilemma
Headline numbers suggest arrears ease as rates come down. The reality in Australia is messier: broad measures dipped into mid‑2025, yet severe delinquencies and non‑bank portfolios remain under ...Read more
