With the recession vs. soft-landing debate still lingering, I take a step back and look at my personal rules for what I think has made me a better investor
Great investing life lessons in this post. Thanks for sharing them. #4 and #6 hit home the most for me...staying curious, continuously seeking knowledge and information and considering all POVs on an idea/thesis.
Unfortunately, in today's social media driven investment world, many investors forget these timeless values.
Perhaps I can suggest one more lesson to add to your list:
Really enjoyed the embedding of your early career. And some events specifically that weren't so clear how they were going to play out when they did. A lot of information we get is a "history favors the victors" kinda thing.
Like seeing how you think about different environments. I wrote down each of the biases for future reference. And how you apply your investment framework to different case studies of present and past.
Feb 12, 2023·edited Feb 12, 2023Liked by Richard Excell
Hello Mr.Richard i just wanted to thank you for the information you provide to us every week, as a university student i find it pretty usefull and intersting. I hope one day to come across each other you seem a very kind and helpfull person. Greetings from Greece
I like Rule no.3. decisions on sizing is, if not the most important, on portfolio management. However, nowadays HF world is full of platforms and quants. outsized concentrated bets on certainity is deemed very risky.
Ex- love this one---ask, answer, learn, test hypothesis all via the Socratic method---learn from others, assimilate, and test out your hypothesis, but do not be dogmatic, recieve validation or invalidation--or treat those two imposters just the same.
In my view, we can get something in the middle of what many are discussing. Market climbed 50% from 1966 low to 1968 high before ultimately coming back down. Maybe some combo of labor market remaining strong for now while wage growth is more moderate (among many other factors) gives us a softish landing for now that allows the Fed to take their foot off the gas and markets to rally for the next year or so. The terminal rate needed to truly crush inflation likely lies above 5% but if the markets and economy continue this way, we could see some Fed complacency (either in the form of a pause or small cuts) that pushes inflation higher once again causing a hawkish Fed that does push the economy into a recession a year or two down the line. We have to remember, our debt based system will likely only allow rates to be high for so long. For now, technicals look good and earnings/guides are not being crushed. I fall into the bucket of some sort of extended rally (1-2 years) before we see the market correct heavily and then get pushed into a recession. I guess time will tell.
Great investing life lessons in this post. Thanks for sharing them. #4 and #6 hit home the most for me...staying curious, continuously seeking knowledge and information and considering all POVs on an idea/thesis.
Unfortunately, in today's social media driven investment world, many investors forget these timeless values.
Perhaps I can suggest one more lesson to add to your list:
We are competing with ourselves when we invest.
Really enjoyed the embedding of your early career. And some events specifically that weren't so clear how they were going to play out when they did. A lot of information we get is a "history favors the victors" kinda thing.
Like seeing how you think about different environments. I wrote down each of the biases for future reference. And how you apply your investment framework to different case studies of present and past.
Hello Mr.Richard i just wanted to thank you for the information you provide to us every week, as a university student i find it pretty usefull and intersting. I hope one day to come across each other you seem a very kind and helpfull person. Greetings from Greece
I like Rule no.3. decisions on sizing is, if not the most important, on portfolio management. However, nowadays HF world is full of platforms and quants. outsized concentrated bets on certainity is deemed very risky.
Ex- love this one---ask, answer, learn, test hypothesis all via the Socratic method---learn from others, assimilate, and test out your hypothesis, but do not be dogmatic, recieve validation or invalidation--or treat those two imposters just the same.
Great post, thank you for writing it! I'm new to being active in markets, and these meta/mindset posts really help me with my mental game.
In my view, we can get something in the middle of what many are discussing. Market climbed 50% from 1966 low to 1968 high before ultimately coming back down. Maybe some combo of labor market remaining strong for now while wage growth is more moderate (among many other factors) gives us a softish landing for now that allows the Fed to take their foot off the gas and markets to rally for the next year or so. The terminal rate needed to truly crush inflation likely lies above 5% but if the markets and economy continue this way, we could see some Fed complacency (either in the form of a pause or small cuts) that pushes inflation higher once again causing a hawkish Fed that does push the economy into a recession a year or two down the line. We have to remember, our debt based system will likely only allow rates to be high for so long. For now, technicals look good and earnings/guides are not being crushed. I fall into the bucket of some sort of extended rally (1-2 years) before we see the market correct heavily and then get pushed into a recession. I guess time will tell.