In the past year I subscribed to the newsletter of an investment adviser about whom I know very little. Pretty much every month he comes out with something awesome, and today’s newsletter was no exception. As I’m not a client of his I can’t vouch for him as an adviser but I like the way his mind works. I’ve excerpted the beginning of this month’s newsletter below:
“You may have noticed that I rarely comment on the market or economy in this monthly newsletter and this month I thought I would explain why and also explain what we do focus on.
There are three reasons why I don’t talk or write much about what the market or economy might do in the near future:
First, no one – including me – generally knows. (See The Signal and the Noise by Nate Silver, Expert Political Judgement by Phil Tetlock, and The Fortune Sellers by William Sherden for example.) Known information is already priced into the market. It is only profitable to invest based on things you know that everyone else doesn’t! That type of knowledge is generally either a delusion (we really don’t know) or insider trading (which is illegal).
Second, there is so much other commentary in the media on the state of markets and the economy that I doubt I could add much of value to the babble. Indeed, I think the best thing we all could probably do is stop listening to most of it.
Third, the important thing is whether you can reach your long-term financial goals such as a comfortable retirement, a quality education for your progeny, or leaving a lasting legacy. What is expected to happen to the unemployment rate or what might happen to the Dow Jones Industrial Average in the immediate future has very little to do with accomplishing those goals. If I spent more time prognosticating it might give the misleading impression that the short term market gyrations are important.”
He’s also the author of something I think is the best summary 4 pages on investing I’ve ever found, which is on his site, but which I’ve uploaded to my scribd.com page as well.
He encourages folks to subscribe to his newsletter through his website. So I’ll encourage you to do the same, on his Ruminations Page.
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