Barry Ritholtz Quotes
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The ability to select stocks, manage them over time and know when to sell them is incredibly difficult, even for professional fund managers.
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Hedge fund managers charge so much more than mutual fund managers; alpha is even harder to come by. They end up selling a variety of things beyond mere outperformance.
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People forget that although we can pinpoint the price, we can only guess at future earnings. The past isn't much help: It simply tells whether a market was pricey or cheap.
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When it comes to investing, you are your own worst enemy.
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A hedge fund manager whose clients demand monthly performance reports has different needs than any individual investors with a 20-year time horizon. The needs of that long-term investor differ markedly from someone who is retiring in three years.
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The good news is that economists are intelligent, engaging and often charming folks. The bad news is their work is often of little use to investors.
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Often, investors will discover a manager after he's had a terrific run, usually when he lands on a magazine cover somewhere. Invariably, funds swell up with new investor money just before they revert to their long-term averages.
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Secular cycles are the long periods - as long as decades - that come to define each market era. These cycles alternate between long-term bull and bear markets.
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You want less of the annoying nonsense that interferes with your portfolios and more of the significant data that allow you to become a less distracted, more purposeful investor.
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History shows us that people are terrible about guessing what is going to happen - next week, next month, and especially next year.
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Even when you are right, there are costs and taxes associated with being tactical. When you are wrong, there are opportunity costs.
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The consumption and production of energy is a major component of the global economy.
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Narrative drives most of economics. Everything seems to be part of a story, and how that story is told often leads to critical error.
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The electronics industry expanded rapidly and the seeds for the semiconductor and software revolution were planted. The postwar period also saw the suburbanization of America, the rise of the homeowner, the build-out of the interstate highway system, and the rise of automobile culture. Credit availability expanded dramatically.
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In New York, the former lack of real competition allowed taxis to extract excessive charges, regardless of the poor service.
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Whenever I see a forecast written out to two decimal places, I cannot help but wonder if there is a misunderstanding of the limitations of the data, and an illusion of precision.
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TV producers want ratings and are willing to do nearly anything to get them. They gin up artificial conflicts and create an urgency for even the most minor of economic data points.
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I credit Google for having the foresight to identify threats to its main business of selling advertising against search results. The potential loss of market share in the mobile space led them to the Android acquisition.
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Truth be told, most financial television bores me. Two or more people discussing the latest economic trends or hot stocks is not especially entertaining.
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Outcome is simply the final score: Who won the game; what numbers came up in a roll of the dice; how high did a stock go. Outcome is the result, regardless of the method used to achieve it. It is not controllable.
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Any Wall Street advertising that does not go into the boring details of methodology is most likely to be pushing past performance.
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Have a well-thought financial plan that is not dependent upon correctly guessing what will happen in the future.
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Forecasting is simply not a strength of the species; we are much better with tools and narrative storytelling.
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Little white lies are told by humans all the time. Indeed, lying is often how we get through each day in a happy little bubble. We spend time and energy rationalizing our own behaviors, beliefs and decision-making processes.