In the five years to September 2025, the price of the leading crypto currency, Bitcoin, increased over 10-fold. Worldwide, millions have bought crypto currencies and a few have amassed substantial fortunes by being early investors.  For many investors, crypto is the latest, exciting new form of investment that has offered seemingly stellar returns. “Just get off zero” has been the enticing call from some advisers who suggest everyone should have at least some allocation to volatile crypto assets. Why would you want to miss out when the rewards have looked so promising? ​

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Investment principles

 

Our 22 key principles will help investors make sensible decisions in this fast changing and often confusing world of investments. Love it or loathe it, almost all of us are investors now and need to make sense of how are our savings are invested.  For example, our first chapter is called “The crux of the matter”, an appeal to only make an investment if the investment case is convincing. If the price of an investment has increased, that makes it more expensive.   It does not make it a worthwhile investment.  The investment principles that underpin the book will help investors reduce the chance of making major investment mistakes. They are:

1. Always look for the substance in any investment proposal.

2. When investing, your most important decision is often not what to buy, but rather how much of an attractive opportunity to buy.  

3. We can be our own worst enemies when we take investment decisions.  Discussions with a knowledgeable advisor can help us manage our money better. 

4. Not all risks are equal.  Risks that might strike at bad times are especially damaging. 

5. If you see easy money to be made in the stock market or anywhere else, you have not looked hard enough. 

6. Star managers don't walk on water. 

7. Most shares underperform the stock market. 

8. In times of acute crisis, government bonds are still the investor’s best friend. But over time, they are vulnerable to inflation.

9. Financial crises are a hardy perennial.  You will encounter them and you should know how you and your savings will respond . 

10. When investing for the long term, it is better to be a tortoise than a hare. 

11. We don’t believe anyone knows where interest rates and inflation will be in 15 years’ time, and this matters 

12. A sensible model portfolio will put you in a good place before a crisis engulfs markets, which it will. 

13. Maintain a buffer of cash.  You don't know when a bad times will arrive. 

14. Simple model allocations are easy to explain and help investors stay disciplined.  They are widely used. 

15. Limited supply can underpin strong price rises for Bitcoin and also gold, but we see no place for either in the strategies of long-term investors.  

16. The glory of compounding accrues most easily to those who adopt a sensible strategy to which they add regular contributions over time.

17. Expensive fees are a dead weight that drag down living standards.

18. Investing in a global tracker fund can be a sensible way to invest in equities.

19. If adjusting your investments to reflect environmental, social and governance priorities, remember to keep your investments well diversified. 

20. In bad times, corporate bonds always show their intrinsic and unhelpful link to stock market volatility.

21. Investing in property is an important component of everyone’s finances and well-being.  Your home has a volatile price, but it can also be a low-risk safe harbour.

22. Investing in things you enjoy owning or supporting gives you more than just monetary rewards. 

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No investor, however large or small their wealth, needs to feel bamboozled by advisers into adopting a complicated strategy they do not understand. The book discusses the contribution of advisers, the impact of high fees on living standards, and considers more sophisticated ways of investing.  We conclude that any investor can sit back and say, “No, I want to keep things simple but appropriate.”

 

​​Investment lessons

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We conclude our book by reminding investors that bubbles and frauds that lead to large losses happen.  This is not news. During your time as an investor, it is almost certain that you will be offered tempting opportunities to participate in what with hindsight will be judged a mania, a bubble, or a fraud.  The more you actively participate in markets, the greater your exposure. Frauds and bubbles are always easiest to identify after the event, when the bubble’s bursting has confirmed its existence, or that of a fraud.  When tempted by exciting opportunities, you need to identify how much pain you can tolerate should something that might be a bubble implode.

 

 If there is one overriding message we want readers of this book to reflect upon, it is the importance of always asking of any investment proposal: “Where’s the substance?” Don’t get seduced by the hope of “money for nothing”.  As with any lottery ticket, the spectacular winnings of a few tempt the many into dissipating their savings when sober reflection points the way to well established routes to managing your savings. 

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Peter Stanyer

Masood Javaid

Stephen Satchell

 

March 2026 

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