You can read financial books, study free information on websites and attend seminars. Yet when that is all done, you still do not really understand investing and trading until you put money into a real position and find out what happens next. This has always been a business of experience and we mean years of experience which cannot be substituted by any books – you just cannot do that.
All traders and portfolio managers who have been in the industry long enough, like myself, agree on one thing. Someday, you will be wrong. I do not mean just a little bit wrong, I mean terribly wrong. We have all been there. I have always been armed with the belief that being wrong does not matter so much if one understands why one was wrong. That way, one can avoid making the same mistakes in the future.
We do not know as much as we think we know, because when you come out of graduate school, you think you know everything – how silly. Forming a view on any markets is akin to juggling many balls in the air. The interaction of many factors can lead to successful or loss-making outcomes. I’m always more concerned about being right than popular. I focus on reality and not sensationalism.
Some emotional people who have been affected by the ups and downs of the markets have asked me about our lazy global market portfolio that aims to achieve long-term growth and diversification with minimal effort and active management.
The term “lazy” in this context refers to the low maintenance and hands-off approach associated with this investment strategy. The best thing about this portfolio is that you can invest and be able to sleep well regardless of economic and market conditions. This is not another “get-rich-quick” scheme.
The lazy model which has a larger allocation to alternative investment funds has been able to perform better than most of the mainstream portfolios out there. People are generally excited about making big money.
The trick is you must not be too greedy and able to hold it. Assets are based mostly in the US dollar. There are other models for those who are looking for more excitement with pockets of speculation.