Before you start reading I would like you to do a reflection exercise for 20–30 minutes and answer the following questions as honestly as possible:

• What are the origins of your investing style?

• Do you invest actively or passively?

• What is your risk tolerance?

• Have you ever experienced declines of more than 40%?

If you are a passive investor,

• What is the rationale for the indices you have chosen and what is the weight of each index in your portfolio?

• What are the management fees?

• In what currency are they quoted?

• Are they equity or bond funds?

• Do you invest all at once or do you make periodic contributions?

*Reflection: If you have answered all these questions, your investment style is active, because there is some thought behind the choice of passive indices and therefore your style could be active.

In case you are active,

• How many assets do you have in your portfolio?

• Where did you get your investment ideas/strategies from?

• The investors where the ideas come fr…