Andrew Hallam Speaks At Raha International School, Abu Dhabi

In 2007, my investment portfolio hit $1 million.

It took 18 years of investing to hit that mark. I had begun to invest every month when I was 19.

My teacher’s salary increased a lot in 2003, when I began to teach overseas. But most of the gains, up to that point, were a result of starting early (in 1989), saving large chunks of my modest pay checks, and understanding how Benjamin Graham thought about the stock market. Ben Graham was Warren Buffett’s professor at ColumbiaUniversity. He wrote the classic book, The Intelligent Investor.

I first read that book around 1995. I had already been investing for about six years. In that book, Ben Graham explained how investors should feel about stock market drops. Warren Buffett has echoed that message. When stocks fall, investors should celebrate.

In the mid 1990s, several of my friends also wanted to accomplish early Financial Independence. In the late 90s, many of us got together on online forums. But when stocks fell 3 years in a row (2000, 2001, and 2003) too many of those people gave up on the dream.

Thanks to what I learned from Benjamin Graham and Warren Buffett, I wasn’t one of them. When Jason Zweig (the Wall Street Journal columnist) updated The Intelligent Investor with end-of-chapter commentary in 2006, he accentuated how we should feel when stocks fall.

He said we should rewire the headlines that we see in the news. When headlines say things like, “Investors Lose As Stocks Drop Hard!” take a page from Graham and Buffett. Rewire the headline. In your head, it should read: “Investors Gain As Stocks Fall Hard!”

After all, if you are a stock market purchaser, you will be paying lower prices for your share of corporate earnings. As a result, your dividend yields will also increase. As a result, you can reinvest those dividends at a far more wonderful price.

Such thinking let me embrace the market crash of 2000-2003. Then another crash came. Between January 2008 and March 2009, my portfolio had dropped almost $400,000. And I was thrilled to see it fall. What’s more, if my portfolio dropped $1 million tomorrow, I would be dancing in the streets.

If you have an income, and you’re able to add money to the markets, you should also celebrate when the stock markets fall.

But don’t change the way you invest. Add money every month, every single year. Ignore all stock market forecasts.

I spoke about this at Raha International, in Abu Dhabi last night. And I look forward to speaking at more locations in the Middle East over the next few days.









Andrew Hallam

I’m a financial columnist for Canada’s national paper, The Globe and Mail, as well as for AssetBuilder, a financial service firm based in Texas. I’m also the author of Millionaire Teacher: The Nine Rules of Wealth You Should Have Learned in School (2nd Ed. Wiley 2017) and The Global Expatriate’s Guide To Investing: From Millionaire Teacher to Millionaire Expat (Wiley 2015). My mission is to educate, motivate and inspire people on basic retirement planning and best practices for investing, using evidence-based strategies. I'm happy to comment on your questions. However, please read the Terms of Use, Privacy Policy and the Comments Policy.

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2 Responses

  1. Dono says:

    Hi Andrew,
    I attended your presentation in Abu Dhabi and purchased your valuable book where you recommend buying Inflation Linked Bonds (IGIL) and still don’t see the upside. I’m a Canadian expat not planning to retire in Canada. I want to build a portfolio of VWRD for Equity and am still hesitating on my bond portion:
    1. Should I go with IGIL, IGLO, VDTY or AGGG?
    2. I’m going with VWRD for stocks. I see you recommend SWDA. Is it better and why please?
    Many thanks in advance in helping me build a balanced sustainable portfolio.

    • Hi Dono,

      In Millionaire Expat, at the end of every nationality chapter, I wrote the same thing: that the specific ETFs you chose don’t matter. Just keep costs low and diversify. Don’t sweat the small stuff….and it’s all small stuff when you don’t have a working crystal ball.

      Cheers,
      Andrew

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