Keep it Simple

asset allocation asymmetrical investments finance invest investing in individual companies investment patience money management patterns valuations Jun 21, 2024

We often say investing is not that difficult. 

In fact in might shock you but there is a very simple formula (that we teach) to making the most money over a long term which is basically 10 years or more. 

How can this be? Well it is important to remember that most of us listen to experts, that are not really experts. Now by that I mean they have the qualifications, but after the initial qualifications are received most don't further their studies and aim to get into a job where they can earn the big bucks.  

So you could not really expect them to hand over the simple formula and do themselves out of a job. And before you say "well, yeah, but you are not giving it away either". Free advice is "cheap" and most of the time people don't value it because they figure if it's free then there must not be any value to it.

This idea is hard to shake. Especially if you don't know anything about the subject matter and again, this is where expert money managers confound us with tricky and specific language. 

Another factor is in my case, it took about 20 years of study to get to the "aha" moment. The formula has been around since the 1950's it's just that it wasn't in the finance industry's interest to promote it and it took me a long time before I "got it".

Most simple things have a world of complexity hidden underneath. E=MCsounds pretty catchy and easy, but there is a fair bit of stuff underneath it:)

And the final factor, which in my experience is the hardest is convincing folks that investing is easy. That's because it is generally harder to shift a person's opinion than it is to present facts and evidence. And the opinions are that investing is complex and requires lots of skills and knowledge. 

Let me tell you - it doesn't.  




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