Investing - Guiding principles

  • Someone can always do your job a little better or faster or cheaper than you can
    • What is your why?  - Financial freedom
  • Change is the only constant - Embrace it!
    • This one should be obvious but people/communities/corporation fight change/disruption and cling on to the old for far too long. E.g. outsourcing.
    • Although, undoubtedly, change and more efficient ways of doing things will be beneficial for everyone in the long run, it will cause collateral damage to a certain section of society/corporations.
  • Sometimes it is easier to identify the losers than winners as a result of disruptive innovation
    • For example, Amazon(the new) and brick and mortal bookstores (collateral damage).
  • You Can’t Kiss Every Pretty Girl (…or Handsome Boy). Handful of quality investment is all you need for a lifetime of financial freedom
    • For examples of opportunities in a lifetime Intel, Microsoft, Goggle, GPS navigation system, Amazon, Apple.
    • If you were interested in shorting a few stocks then the demise of Blackberry (RIM) & Nokia was in plain sight
  • Mistakes - You won't be right all the time!
    • As Seth Godin says - "Fail fast and cheap. Fail often. Fail in a way that doesn’t kill you. This is the only way to learn what works and what doesn’t. You are going to make wrong decisions, no question about it. Make them fast and cheap"
    • When you feel strongly about something, make big bets, but no so big that it will throw you out of the game. It doesn't matter how many times you are right, what counts is how much money you make when you are right, how less you lose when you are wrong
  • The art of observation is the key to investing
    • Frederick Franck states: 'the glaring contrast between seeing and looking-at the world around us is immense; it is fateful'.
    • Learn to observe without judging, without letting thought intrude between you and the object
  • Somebody will always be getting richer faster than you - Stop fretting about it

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