Many of my clients frequently ask me what are the core beliefs I hold about investment management that guide my recommendations. This is a very abbreviated version of what I believe, but I thought you might find it helpful in understanding a little about how and why I make the recommendations that I do.
- Investor behavior, not investment performance, is the largest determinant of long-term success, so focus on what you can control (which is your behavior and wherewithal) and forget about what you can't (which is everything else).
- Greed and fear are poor counselors, so let reason, not emotion, be your guide.
- Capital Markets, not capital managers, make money, so pursue the reality of long-term capital market returns, not the illusion of short-term manager-driven performance.
- Live for five more years and money is not likely to be your big problem. Live for twenty-five more years and it may be, so think long-term, not short term; in decades, not years.
- In an ocean of information, signal and noise (or information that matters, and that which doesn't) are easily confused, so focus on the few things that matter, not the many that don't.