|An interesting quote from The Economist: “Finance is a brain for matching labour to capital, for allowing savers and borrowers to defer consumption or bring it forward, for enabling people to share, and trade, risk.”|
For most of us, the second part of this elegant description of basic capitalism is what drives us to pursue investing in general, and the equity markets in particular. As savers, we defer consumption (save rather than spend) for many events; a first home, a second home, college funds for our kids, retirement for ourselves, etc… As borrowers we bring consumption forward (using loans and credit), for good reasons and bad; the mortgage on our homes, a really expensive watch that we quit wearing after a few weeks, etc…
Strike a balance.
The trick is to strike a balance between what we have and what we owe. Few people are able to buy a new home outright with cash, so a mortgage is usually inevitable. But as long as there is growing equity – a meaningful down payment and the shortest loan period manageable – the house feels more like an asset than a liability. The same idea applies to equity investments. Striking a balance between conservative, income-producing investments and riskier, but potentially more lucrative bets. Through this process, we strive to end up with more assets than liabilities, with more cash than debt, with more peace of mind than useless stuff.
And this gets to the heart of many financial problems, which is a failure to adequately balance assets and liabilities. Owning a million-dollar home isn’t all that great if it cost $1.1 million and was purchased with no money down and a 30-year mortgage that doesn’t begin to create equity until after the first dozen years of monthly payments. This home isn’t a person’s biggest asset but their biggest nightmare.
Over time, with much work and patience.
While enjoying an interview with jazz guitarist Pat Metheny this weekend a comment germane to the discussion of how to be a better investor – or, steward of personal assets – loomed large. He was talking about the changes he has seen while touring worldwide with his band (since 1977) of how people treat time. Metheny stated that people have become, perhaps, too cognizant of how they manage time. Everything is now expected to be accomplished quickly and efficiently. But, he said, to reach the level of expertise required to become a professional musician requires a lot of time and practice – and this cannot be done quickly or efficiently.
Warren Buffett once wrote: “It is not necessary to do extraordinary things to get extraordinary results.” An interesting observation from a guy who did not become one of the richest people on the planet quickly and efficiently, but over time and with much work and patience.
The markets we face today are some of the most volatile in recent memory. Previously reliable correlations between asset classes have broken down. Investment options never before available to individual investors now come in several varieties. We can invest in businesses located and operating, almost any place on earth. And corporate malfeasance, government intervention, currency fluctuations, communications interruptions, disruptive technologies, and irrational behavior still remain challenges to profiting as an investor. Being able to operate in this environment is not a skill that will be acquired quickly and efficiently.
A good beginning.
Becoming a successful investor will not happen by reading the latest edition of Investing for Dummies, or following the weekly ramblings of a financial columnist, or spending a weekend visiting investment web sites on the Internet (though all these things executed in tandem are a good beginning). Yes, people win lotteries, but not deliberately because of their actions, or more importantly, repeatedly over time.
So remember, try and keep three or four months of cash-on-hand for emergencies, keep the majority of equity investments in conservative instruments and avoid using debt to fund a lifestyle your paycheck can’t.
|For the interested, or discerning, listener “Tenor Conclave” offers a chance to really hear the distinct sounds of John Coltrane, Zoot Sims, Hank Mobley, and Al Cohn.|
The output of the Rolling Stones rolled off my radar a couple of decades ago. Hearing some newer music recently it was not difficult to recognize the sound, even if it has evolved somewhat since I last tuned in (around the release of Steel Wheels in 1989). So why does it surprise people that the sound of John Coltrane is just as identifiable to a fan? For someone even mildly familiar with the music of the Rolling Stones and Beatles it is hard to believe the difference wouldn’t be immediately obvious. Ditto for Coltrane and Hank Mobley despite their playing the same instrument.
Reading the liner notes from a 1956 release from the Prestige All-Stars we find this to be a tired conversation. Ira Gitler opens his note with the following comment; ‘Last year a writer on jazz posed a question to me. It was, “How do you dig both Sonny Rollins and Zoot Sims?” and I answered, “Because I dig both Bird and Pres” (i.e., Charlie Parker and Lester Young).
The album referenced here is “Tenor Conclave” featuring John Coltrane, Zoot Sims, Hank Mobley and Al Cohn on tenor saxophones, Red Garland on piano, Paul Chambers on bass and Art Taylor on the drums. While Gitler focuses mostly on contrasting the two “schools” of sax represented – that of the hard bop (Parker) and the modernists (Young) – this still seems too broad of a distinction. Yet Gitler is correct when describes this album as not a “cutting session”, something that could have easily occurred, where players push each other to show-off. As he correctly states, “Each of the four showed admiration for the other three…”
For the interested, or discerning, listener “Tenor Conclave” offers a chance to really hear the distinct sounds of each tenor. The title cut, an original composition by Mobley, is a swinging affair, where personalities and sounds are distinct. Followed by the standard, Just You, Just Me, at the opening we hear the ensemble, then a bridge with only Mobley and Sims. After another 8-bars of the ensemble, in sequence, we hear the solos of Mobley, Sims, Coltrane, and Cohn. The second Mobley composition, Bob’s Boys, plays to the strengths of Sims and Cohn. In the last of four songs on the album, How Deep is the Ocean, we hear an achingly lyrical rendition of another jazz standard. Hard to believe even a novice couldn’t hear the difference between Coltrane and Cohn here, despite the lighter touch.
Of particular note is the fact this recording pre-dates the Blue Note albums for which Coltrane and Mobley are so well known. Here Gitler’s two schools are further subdivided to provide additional commentary about each player. For Coltrane, there are already hints of the “sheets of sound” to come. The Coltrane sound has also been described as very muscular, which sounds about right. In contrast, Mobley’s most successful album to my ears is “Soul Station” with “Workout” a very close second. Gitler uses the term “sinewy” to describe Mobley’s playing.
The players usually associated with the East Coast, Cohn and Sims, find a reflection of their work with jazzmen like Gerry Mulligan, Bob Brookmeyer, and Shelly Manne. Theirs is a more swinging sound influenced by the classic big bands of Woody Herman and Count Basie. In the most complimentary sense, Sims is more smooth than muscular with Cohn more fluid than sinewy. The contrast between bop and modernist is not as obvious here as is the stylistic preferences of each player. While this distinction between schools becomes more pronounced over time, here we listen to an ensemble working hard to achieve harmony and a blending of personalities through this music. It is not clear to me that the Prestige All-Stars would have sounded so cohesive if they had first recorded together in 1966.
|“Chaos is an azure line that surrounds all the world.”|
From the Sefer Yetsirah|
While reading the Sefer Yetsirah by the light emanating from a painting of Lucas Cranach I was approached by an angel whose wings were covered with blinking eyes. As it hovered above the table where I laid down my book, the angel offered me an envelope. Carefully opening the letter I discovered inside a single sheet of fine papyrus embossed in the lower right-hand corner with a single symbol. Not immediately identifiable, the curious figure reminded me of the Monad of alchemist John Dee, as it had been described by the polymath Athanasius Kircher. The angel hovered above me, the eyes on its wings moving in every direction until I realized the papyrus sheet was an invitation.
I hastily gathered up some bread, beer and the philosopher’s stone placing them in a small package. After donning a hat decorated with five flowers, I followed the angel as it flew out of my library. As the angel finally identified itself as Semyaza I felt an indistinct unease, like that, encountered as one begins a long journey.
Moving into the darkness of night Semyaza led me through a series of gates guarded by: An ancient Oriental man wearing a sky-colored robe; a sphinx made of mercury; the sacred painter of the profane, Father Giotto; and ultimately we passed a virgin named “The Magdalene” who was carefully extinguishing devotional candles resting on a small alter covered with a red cloth.
Semyaza bade me farewell, leaving me before the entrance to a great courtyard. Here a group of angels, whose faces were dirty with soot, bound me tightly with rope and left me alone in the darkness, awaiting dawn. The morning light revealed a gallery on the west side of the courtyard. It slowly filled with 999 sacred falcons, all bred in the gardens of the Temple of Behkdet in Egypt. A priest wearing a gold mask shaped like an ibis declared loudly that the falcons had deemed me to be not entirely unworthy. As such, I would be allowed to witness the terrible spectacle of a Chymische Hockziet. With this proclamation, the priest turned to leave as the sky filled suddenly with shrieking birds flying in every direction and I was reminded of the eyes on Semyaza’s wings. Then the ropes that had held me fell away and again I was alone.
The angels with dirty faces returned and I was given a handsome pewter goblet filled with a powerful smelling, blood-like liquor and told to drink. Closing my eyes as I slowly sipped from the goblet, a feeling of heat spread throughout my body. A vision of a royal sepulcher in all its sublime glory appeared before me. I was led to a magnificent library like that of Borges imagination and felt bliss.
Upon leaving the library I found myself in a small, enclosed garden. Spying a large three-tiered fountain, I first drank and then bathed. Refreshed, I went down a dark, spiraling stairway furnished with rare tapestries and beautiful paintings, though I was saddened to realize none were by Nicholas Poussin. The stairs ended at a great hall whose walls and high ceilings appeared to be made of flames. In the center of this awful place rested the skull of Adom Kadmon with a serpent crawling in and out of the eye sockets. The name Lilith had been painted on the snake’s back in silver.
A door at the far end of the flaming hall opened to the shore of a raging ocean. A single ship being tossed about on the waves awaited me. Boarding the boat I found no one else there. My only recollection from the voyage was passing an island around which nine muses slept fitfully as they floated upon a green foam that remained undisturbed by the rough seas. Arriving at a place very cold and seemingly without color, I was carried off by four wingless angels, each with an aleph painted in gold on its forehead. They laid me on a blue cushion in the middle of a vast stone floor that had no walls. Sitting there in the numbing cold I gazed at the endless ocean until midnight, when I fell into a troubled sleep.
It must have been very early the next morning when priests, dressed as gods from Ancient Egypt, woke me up and led me across the vast pavement. Arriving at an undecorated stone building, I was asked for my small package of offerings as well as the five flowers still decorating my hat. In return, I was given Occam’s Razor, which I carried tentatively into the building. We entered a room, identified in small letters carved above the door as the Nuptial Hall, where I took a seat among mostly empty pews.
A battered wooden alter rested against the east wall and in front of it stood Enoch, whose hat was now decorated with my five flowers. He stared intently at the opposite wall and I turned to see his bride to be, the sweet Shekinah, making her way slowly toward the altar. The room was growing increasingly hot and I realized the sun was now shining brightly through long, thin windows and casting alternating stripes of light and shadow across the room. A priest who reminded me of the Pharaoh Akhenaten rose from the front pew and turning around with his back to the bride and bridegroom began speaking in a sonorous voice of love. As he spoke, cherubs descended carrying a massive crown, made of many precious stones, that was held above the heads of Enoch and his sweet Shekinah.
Suddenly a great cacophony erupted as the angels with dirty faces flew into the room carrying the blue cushion I had slept upon the previous evening. Then just as quickly, the room became completely silent as Semyaza entered with the pewter cup I had brought here the day before. Handing it first to Enoch, and then his sweet Shekinah, the couple took turns partaking of the evil red liquid before smashing the goblet against the stone wall. Semyaza picked up the broken pieces of the pewter cup and placed them on the blue cushion. When his sweet Shekinah kissed Enoch gently on the stomach I sensed the ceremony was over. As if leading a royal procession, Enoch and his bride left the Nuptial Hall at the head of the few attendees.
Only Semyaza and I were left in a now deserted room. The angel pointed at the floor beside the wooden altar where I noticed a large, beautiful painting by Max Beckmann of a woman lovingly embracing a mandolin as she lay asleep. Semyaza asked that I lay down on the painting where I proceeded to again fall into a troubled sleep. As the sweet Shekinah and her groom sailed away aboard the ship that had brought me to this place I dreamed of my long passed youth and wept softly.
Trumpets sounded as these visions faded from my memory and all that was dark became light.
|Talk about a career in jazz… Gerald Wilson’s first album as a leader was released in 1961 and his last recording was released in 2011.|
First hearing the big band sound of Gerald Wilson was a revelation. Talk about a career in jazz, Wilson played trumpet in the Jimmie Lunceford Band back in 1936. A mainstay of West Coast jazz players, he wandered in and out of the limelight for 50 years, his first album as a leader, You Better Believe It being released in 1961. He died in 2014 at age 96, with his last recording, Legacy, released in 2011.
It was a pleasant surprise to discover that he was not only a big fan of the bullfight, but many of his signature works (two of which are reprised on “Detroit” from 2009) are named after famous bullfighters of the 1960s. He considered matadors and jazz musicians to be kindred spirits engaged in a similar kind of art form. Wilson was befriended by bullfighting professionals and is an honorary life member of Los Aficionados de Los Angeles (sort of like the Bullfighter’s Union of the U.S). The complete oeuvre of Wilson’s tributes to the corrida is listed below. I deliberately chose to only include the original of each song, and encourage you to check out some of the later versions on your own.
This song is named for Jose Ramon Tirado. “He was a young matador I first saw at the bullfights in Tijuana, Mexico,” Gerald says. “He was sensational, had a lot of style, reminds me of one of the young trumpeters today. I was so impressed that I wanted to do my impression jazz-wise of what was going on with him.”
This song is named for Paco Camino. “Paco Camino became the biggest man in the bull ring during that period. He came on with some new stuff that was out of sight. Bullfighting is not a sport, you know. It’s an art, continually evolving with new passes, new uses of the cape, new ways of confronting the bull, adding to the repertoire. It’s very much like jazz. Paco was an artist. He improvised. He was the best,” said Wilson in 2004.
Featured in Sports Illustrated in 1963, ” Paco Camino is the greatest torero of the past 20 years,” said Antonio Diaz-Canabate, one of Spain’s foremost authorities, writing in Madrid’s influential newspaper, the A.B.C. “He leads the bull with the muleta where the bull does not want to go. That is the most difficult thing in the art of bullfighting because it involves the total domination of man over beast.” And a well-known Barcelona critic, Jose Maria Hernandez, wrote of Camino, “He does everything to perfection. He has an indefinable magic. People will remember Camino, like Manolete, not for any one pass or quality, but for his general art and technique.”
This song is named for Santiago Martín, known as El Viti. This is the only recording Wilson made where he played with the band. “El Viti was a great matador, different from any other I ever saw. He never smiled, and he was tough. I tried to trace a picture of him, as it gets down into a unique part where his stuff in the ring would get, wild but not overbearing. It was a place for me to use my eight-part harmony.” Wilson claimed to invent eight-part harmony. El Viti was considered to be the “master of the Verónica.”
The Golden Sword
Dedicated to the pageantry of the bullring.
This song is named for Carlos Arruza, known as “El Ciclón” (“the cyclone”). Retiring after a successful career bullfighting on foot, he came back to start an even more spectacular career on horseback. “He was one of the greatest of all time,” said Wilson. Arruza appeared in two Mexican films about bullfighting and had a part in the 1960 version of “The Alamo” starring John Wayne.
This song is named for M. Capetillo, who performed frequently in Tijuana from the 1960s through the 1980s. He was celebrated as the greatest muletero in Mexican bullfight history. Wilson watched Capetillo fight his last bull on the eve of his retirement.
This song is named for Antonio Del Olivar and was the last of Wilson’s tributes to famous bullfighters. Considered one of the most graceful matadors, Del Olivar once honored Wilson by presenting him with the ear of a bull he had killed.
|A market pullback is likely, maybe even inevitable, but market timing is a dangerous game. Carefully and over time is the preferred method of creating wealth.|
With lots of anecdotal evidence suggesting caution when betting on the equities markets these days, maybe we shouldn’t be. An oft-discussed subject in what passes for financial commentary is the sell-in-May-and-go-away theory. The debate is framed by the biases of the respective authors and can be used to support both action and inaction. Then again, maybe it could be a bit of both?
The Boys at Bespoke point out that the results of market returns during May over the last 20 years has appeared to be influenced by the direction of indexes during the first part of the year – May is more likely to be up if equities had a good start to the year. June has statistically proven to be worse than May, but then July has traditionally seen relatively strong returns. And their advice seems about right for most casual investors, “hold-in-May-and-go-away.”
Looking at the views of people whose musings I tend to respect, current market valuations are higher than one might like to see as net purchasers for the long term, but certainly not unreasonable. The recent (apparent) lack of market volatility has masked an underlying trend of segment sell-offs, making last year’s high flyers today’s dogs. And investor sentiment, far from enthusiastic, seems to suggest a continued reluctance of the individual investor to earnestly commit to embracing individual stocks.
So my bias has been toward action over the last couple of months, as it will likely remain over the early part of the summer. Adding the S&P ETF (VOO) on the big down days, but also picking up smaller and more volatile stocks for the short-term. A couple of the names I’ve been playing with (and this is pure gambling) are IRVRF and RUTH. There are still some nifty stocks to own over the long haul (for those of you with some history in the markets, not any nifty-fifty type of opportunities) but these are intended specifically for retirement accounts due to their yield and opportunity to add a bit of upside to a basket of sector-specific ETFs (LTC and BX as examples).
Yes, a market pullback is likely, maybe even inevitable, but market timing is a dangerous game. Just ask Warren Buffett, successful investing is a marathon, not a sprint. Carefully and over time is the preferred method of creating wealth.
|The bull and its blood symbolize a call to nature at its most brutal, pure and irrational. -Jose Antonio del Moral|
If you are not a fan of bullfighting please move along. My interest in defending this sport is exactly zero.
There is a documentary about bullfighting, The Matador, by Seavey and Higgins, that follows a very young (and now very famous) Spanish bullfighter, David Fandila, over a three-year period as he struggled to complete 100 corridas in a single season. A cursory glance at the reviews found the film to have been well received when it premiered in 2008, and this in spite of the subject. While I found the story of “El Fandi” more engaging than the story-telling, it certainly offered up some great bullfighting video and even better quotes; from Jose Antonio del Moral, “The bull and its blood symbolizes a call to nature at its most brutal, pure and irrational.”
Many casual comments become quite compelling when scrutinized, including agreement from El Fandi, that he is not an artistic bullfighter. This observation is not without merit, since a comparison to, for example, Enrique Ponce provides a clear contrast in styles. Ponce performs with an elegance of posture and movement that even a first-time viewer would likely define as classical. Whereas El Fandi demonstrates a theatrical, often coarse flair more akin to an entertainer. This difference in approach is not just about technique. It is about the purpose of the spectacle found only in a corrida.
El Fandi states unambiguously his desire to deliver a memorable performance, to “bring the audience to ecstasy.” Being a great bullfighter in the traditional sense appears less interesting than being an inspiring entertainer. del Moral offers another observation to this point, “…but it is a beautiful savagery with an artistic payoff.” By comparison, he refers to ballet, where the movement of the human body is regarded as artistic expression. Yet for El Fandi, it is the elegance displayed in the face of death that defines the artist. While a whiff of fear will destroy an otherwise masterful performance, El Fandi chooses to exaggerate his bravado, delivering a show that forcefully reminds the viewer of the high stakes being wagered with each corrida. His technique is less about the form (classical) than in the delivery (entertaining).
It is also worth noting that the documentary does an excellent job of reminding the viewer that the bulls can give as good as they get. The remarkable scene of El Fandi being gored, immediately undergoing surgery, then returning to the ring forty-five minutes later to continue fighting is unsettling to the extreme. And a vivid reminder of what separates the truly great from the rest of us mere mortals.
Finally, it is worth knowing that a bull only fights once, if it survives it is put to pasture. Speaking about the bulls that survive the corrida, a young David Fandila talks about the “inner calm” he senses when in the presence of these winning champions. Interesting observation from a guy whose death in the ring is the only way for a bull to enjoy an “inner calm.”
|“Avoid the unforced error, nail the basics and don’t take outsized risks” might be the best advice the individual investor can follow.|
An often-underestimated influence on equity and bond markets is the heavy hand of luck. Frankly, you can do everything “right” and still get bad results. And since luck can’t be controlled, knowing how to react – whether that luck initially appears to be good or bad – can separate winners from losers. But just because something can’t be controlled doesn’t mean it can’t be managed.
We all know bad things happen that are beyond our control to foresee or influence. Fires, floods and financial crisis come to mind. So we buy insurance, avoiding home purchases in areas prone to flooding and create investment portfolios that are well diversified with a healthy dose of cash savings. But what else?
One of the best thinkers on this subject, and a terrific writer to boot, is Michael Mauboussin. The man knows how to think about how we think – especially as it relates to investing. I read his terrific 2012 book, The Success Equation, when it first came out. Subsequently, the opportunity to hear him talk about his book in person helped to clarify some of his more nuanced arguments and observations.
One of the many surprises that will be found in The Success Equation is an important reason why individual investors should look to exchange-traded funds as their best bet to achieving financial goals when using the stock markets. Discussed in many posts here at Invest-Notes, by choosing to invest in indexed funds smaller investors earn the market averages over time with much less risk or cost than owning individual stocks or traditional mutual funds. Remember, for as long as equity markets have been measured, they have gone up more often than they go down.
Let the Big Dogs Bark at Each Other Instead of You
As noted recently in The Economist, 70% of U.S. stock markets are now owned by large institutions like Blackrock, Vanguard, Fidelity, pension funds and hedge funds. That percentage was just 35% in the 1980s. This means the self-described investment professionals are competing against each other more fiercely than ever before. As Mauboussin intriguingly suggests, the more skill involved in a competition the bigger the impact of luck on the outcome.
As a reality check, the following is from the prospectus of an initial stock offering (IPO) for a high-tech company that went public in March of 2017. Hyped by many, including the original investors then in a position to sell their much-appreciated shares, this quote sounds like a fair warning in my books, “We have incurred operating losses in the past, expect to incur operating losses in the future, and may never achieve or maintain profitability.” But if this is such a great investment, why would the private owners want to sell their stock in the company? If you had purchased shares at the IPO, you paid the original investors around $26 per share. Your investment is now worth about $13. So, as two of the biggest money-losing companies on the planet begin selling shares, no names but they provide ride-sharing services, best to avoid this ride.
By being honest and observant about the outcomes of our investment strategies – repeatedly and over time – we can create mental models that help anticipate the unexpected (to minimize risk) while expanding opportunities (to maximize upside). You can easily improve your overall return just by minimizing costs like fees and commissions (nail the basics). You can stay calm and remain inactive during times of great stress (avoid unforced errors). You do not have to go head-to-head with the pros (no outsized wager on a hot stock tip).
As Rudyard Kipling noted a century ago, just ”…keep your head when all about you are losing theirs…”
More on… “The Success Equation”-Michael Mauboussin:
The pursuit of wealth (and then figuring out how to keep it when successful) has a long history. The wide-ranging insights below are offered without commentary. However, where additional context is available a good source has been recommended on the pundit or their life. I have read all of the books suggested.
Circa 600 BC
“The observation of the numerous misfortunes that attend all conditions forbids us to grow insolent upon our present enjoyment, or to admire a man’s happiness that may yet, in the course of time, suffer change.”
(Nassim Taleb translates this into the vernacular by quoting Yogi Berra, “it ain’t over until it’s over” in Fooled By Randomness, 2001)
Leonardo da Vinci
“Do not undertake things if you see that you will have to suffer in case you do not succeed.”
“Trust only those who have exercised their minds not on proofs of nature but on the results of their own experiments.”
Estimated net worth in current dollars: $400,000,000,000
(J.D. Rockefeller clocked-in at only $340,000,000,000)
“When I go to bed, I face no obstacles to sleep. I remove with my shirt all the cares of battles and business.”
“I will earn a profit as long as I can.”
The Richest Man Who Ever Lived, Greg Steinmetz, 2015
Netted $3,000,000 in the 1929 market crash.
(Went bankrupt twice before and after 1929)
Cut your losses quickly.
“If a trader doesn’t know his exit before he takes the entry, he might as well go to the racetrack or casino where at least the odds can be quantified.”
Let profits ride until price action dictates otherwise.
“It never was my thinking that made the big money for me. It always was my sitting.”
Control your emotions.
“All through time, people have basically acted and reacted the same way in the market as a result of: greed, fear, ignorance, and hope.”
“Buy all-time new highs.”
“We have met the enemy and they are us.”
“One investor’s two rules of investing:
- Never lose money.
- Never forget rule #1.”
“Concentrate your investments. If you have a harem of 40 women you never get to know any of them very well.”
“Investors operate with limited funds and limited intelligence: They do not need to know everything. As long as they understand something better than others, they have an edge.”
“If I had to sum up my practical skills, I would use one word: Survival.”
Money Masters of Our Time, John Train, 2000
“Excesses in one direction will lead to an opposite excess in the other direction. Think of the market baseline as attached to a rubber string. Any action too far in one direction not only brings you back to the baseline, but leads to an overshoot in the opposite direction.”
“Fear and greed are stronger than long-term resolve. Investors can be their own worst enemy, particularly when emotions take hold.”
“When all the experts and forecasts agree — something else is going to happen.”
As Stovall, the S&P investment strategist, puts it: “If everybody’s optimistic, who is left to buy? If everybody’s pessimistic, who’s left to sell?”
Considered one of the most successful hedge fund managers of all time.
“Make all your mistakes early in life: The more tough lessons you learn early on, the fewer (bigger) errors you make later. A common mistake of all young investors is to be too trusting with brokers, analysts, and newsletters who are trying to sell you something.”
“Don’t make small investments: You only have so much time and energy when you put your money in play. So, if you’re going to put money at risk, make sure the reward is high enough to justify it.”
For more: More Money Than God, Sebastian Mallaby, 2010
Investor and author of What I Learned Losing A Million Dollars, 1994
“There is an inverse relationship between your threshold for pain and success in the markets, so as soon as you feel the pain: get out.”
“I am always thinking about losing money as opposed to making money.”
“No matter how you cut it, there are enormous emotional ups and downs involved.”
More Money Than God, Sebastian Mallaby, 2010
Now, who and what can you add to this list? Leave your comments below…