“The market can stay irrational
longer than you can stay solvent” warned John Maynard Keynes. “When there is
nothing particularly clever to do, the potential pitfall lies in insisting on
being clever” adds Howard Marks. I am a big believer that the Emperor is
wearing no clothes in many parts of the investment industry. The world is ambiguous,
complex, and random. We seek out heroes who ooze confidence that is unwarranted.
Many investors names are made or destroyed on a handful of decisions. Either these
buy a decade or two (a career) because of something going well, or they have a
failure carved into their souls. Extreme success may mean 60% of their decisions
are right. A coin gets 50%. The margins are wafer thin. So regularly
remembering that investing is more like dieting and exercising than a “how
smart are you” contest is important. Everyone eats. Everyone moves. Make sure
you are one of the people building towards something, rather than against
someone.
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