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The ultimate superpower in investing
The best way to navigate that uncertainty is not to run from it, but to accept it. Investors tend to fall into one of two groups: Those who think they know what's going to happen next and act on their supposed insights, and those who admittedly don't understand what's going to happen next and choose to sit on the sidelines. Neither is the sign of a
... See moreMorgan Housel • 50 Years in the Making: The Great Recession and Its Aftermath
The 60/40 allocation only spends about 22% of the time at new highs, and the other 78% in some degree of drawdown. Drawdowns are physically painful, and the behavioral research demonstrates that people hate losing money much more than the joy of similar gains. To be a good (read: patient) investor you need to be able to sit through the dry spells.
Meb Faber • Global Asset Allocation: A Survey of the World’s Top Asset Allocation Strategies
Not “growth” or “brains” or “insight.” The ability to stick around for a long time, without wiping out or being forced to give up, is what makes the biggest difference. This should be the cornerstone of your strategy, whether it’s in investing or your career or a business you own.
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Warren didn’t mind substantial variations in market prices over months or even a few years because he believed that in the long run the market would be up strongly and by regularly beating it during its fluctuations his wealth would grow over time much faster than the overall market.
Edward O. Thorp • A Man for All Markets
