Simple principles for investing

Eugene Fama
Professor of Finance, University of Chicago Booth School of Business
Director and Consultant, Dimensional Fund Advisors LP

Professor Eugene Fama is one of the world’s most influential financial academics and Nobel Prize winner.

He is known for his research into financial markets and the relationship between risk and return.

Despite the depth and complexity of his work, his ideas boil down to simple principles that relate to why long-term investors should know the reasons they’re investing, how to understand risk, and ignoring short-term ups and downs.

In three short videos below, he explains these principles in his own words.

Video 1 – Why do you invest and how much risk do you take?


Video 2 – Reacting to markets… “You don’t want to be paying a lot of attention to what’s going on in markets.”


Video 3 – Risk makes the economy work


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