First of all, my name is Nicholas Ahonen, and I live in Stockholm, Sweden, and I am very pleased that you have found your way to following my blog about the All Seasons Portfolio. Let me therefore take a few moments here to tell you why I got around to blogging about investing and why I so strongly believe that what I do here is important and matters.
My short-form CV could be summarized as that I have a master’s degree in Business Law, and have since 2017 working in banking, where my experience is from syndicated multi-lender corporate lending, as well as real estate investment banking, both with focus on the Nordic market. Working close to the heart of capital markets can only be described as a valuable experience about both macroeconomic factors to lending, on top of the natural corporate analysis. The skills obtained can very well be translated into any investment and asset allocation process.
In addition to my work, I always try to improve myself by learning. Over the years, I have been studying to improve my asset allocation skillsets, both in a structured university environment through part-time courses, and through the vast flora of great content available on the web about risk parity from the likes of AQR, Resolve Asset Management, Bridgewater, in addition to articles available at SSRN. There is a lot to feed my curious mind on these subjects.
Starting to invest
When I was 17 I did my first trade with stocks. I had not done any particular research on how you invest, but started out together with a few friends at high school. Trial and error is my preferred learning experience. I think that the first stock I owned was two shares in Swedish clothing company H&M. I remember I bought them in December just a few weeks before Christmas. I only owned them for a day or so before I sold them at a small profit. In fact, the whole profit was erase by trading fees but that didn’t matter. I had tried and the profit on paper was enough to get me excited. I had learned something, and looking back at it today, I have come a long way since.
Wanting to help small business owners, I chose to study business law at Linköping University. During my time there, what I enjoyed the most was the writing of my bachelor and master theses. Both were on different aspects of the legislation of crowdfunding – being financing methods for small businesses – and in between writing these two lengthy texts, I also wrote and published a book on the subject (ISBN: 9789172236462) in my spare time when not studying. This really helped me practice more grit – while writing about a subject I was passionate about. The second thesis, however, while still about crowdfunding, was more aimed towards protection of investors for equity crowdfunding investing.
What a law degree gives you that is useful in all parts of life is mainly twofold: firstly, you are trained in acquiring and processing information. This helps when you want to build complex portfolio, but also to distill the information to be presented in a way that is easy to access. Secondly, it gives you an excellent sense of managing risks. It is the latter that has been most useful for me when I set about to digest all there is to know about risk parity investing and the All Seasons Portfolio. Through my endeavours, I have found that helping investors and people through my knowledge in finance, is what I want to spend my life doing.
What made me start the All Seasons Portfolio blog?
That is why I started this All Seasons Portfolio blog. It can help people in so many ways financially, and you don’t even need to be that financially literate. As long as you have a decent broker where you can find the basic ETFs, you can get started.
I have met so many people without even the slightest financial safety net. I am sure you know someone too who does not know how the financial markets work and how it can help them build wealth. It doesn’t need to be great ‘wealth’, but rather a safety net if one looses the one’s job or to have a decent life when retiring. People close to me – family members – are lacking a decent pension due to financial choices in the past and do not know what to do with the money they got.
With a transition over the last decades of pension schemes going from defined benefit (when a retiree is promised a certain sum at retirement, often linked to a salary) to defined contribution (when a worker is promised a certain amount that is set aside each month instead of the size of the pension), the risk of pensions has been shifted from governments/employers to the worker. If there is a shortfall in your pension against what you had expected, it is to your detriment – not the government or your past employers. That is why it has become more important than ever in modern history to save for retirement, and you better start early and you better diversify.
When you are not so knowledgeable of the mechanics of the financial markets, you are at the same time extremely afraid that your money will be lost. It is improbable that you will loose all your money when buying mutual funds or ETFs, but you may from time to time see the value decrease. That fear, is even triggered when the portfolio value drops even a few percentage points. But, such bumps, are to great extent lowered with the All Seasons Portfolio Strategy.
The beauty with the All Seasons Portfolio is also that its growth is stable and does not crash in the same way as portfolios that are 100% allocated in stocks. Neither is it as volatile as gold nor as slow-growing as bonds. But when you combine these asset classes, their movements counter each other, and actually gives you stable growth from year to year.
But how do you teach someone inexperience about portfolio strategies and investing if you are the one who is passionate about it? The conclusion I reached was: you show them. That is why, I sacrifice my very personal details about my financial life, in order for you to learn. What I offer you, is a very basic gift when I talk about my life, my portfolio and my investing.
On these pages I give you me and my experiences, and I always welcome your comments and questions. Dialogue is without doubt the best tool for learning.
And all I want in return, is for you to do your best to grow.
Cheers!
Nicholas