Two investing quotes and one question to consider on your journey to wealth creation for the week of August 8, 2021.
“Success in life comes from recognizing patterns. Pattern recognition is what gives anyone an edge.”
Be sure that you have a tried and true blueprint that you are following so that you don’t have to invent the wheel. If you can find a way to cut out less than optimal ideas and strategies, based on the experience of others, you can focus on high probability, high reward actions. As Buffett suggests, always seek out the “one foot hurdles.”
“The entire pursuit of wise investing requires you to see where the crowd is wrong so that you can profit from their misperceptions.”
Being out of sync with the crowd is easier said than practiced. In almost every area of life, we are pressured to be in step with the crowd because humans are social creatures. It’s how we find belonging, identity and safety. This is not the case in investing. You have to be comfortable zigging when the crowd zags. If everyone knows a company is a great investment then it’s too late to buy at a deep discount. It’s an uncomfortable path to wealth but an insane amount of legendary money managers agree.
One Question to Consider:
- Can I clearly explain my investment philosophy to a group of 9th graders?