Barry Ritholtz Quotes
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Indeed, eventually, random outcomes all revert to the mean, meaning that streaks eventually end. Understanding this is a key part of intelligent and rational investing.
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Asset managers have different approaches, and I don't wish to suggest there is only one way to run money. There are many ways one can attempt to reduce risk, improve performance, lower drawdowns and reduce volatility.
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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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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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Getting more and more of our news from the social network is having significant repercussions for markets - and your money.
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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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It is important for investors to understand what they do and don't know. Learn to recognize that you cannot possibly know what is going to happen in the future, and any investment plan that is dependent on accurately forecasting where markets will be next year is doomed to failure.
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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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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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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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The consumption and production of energy is a major component of the global economy.
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Yearly data put the rest of the noise into perspective. Most of the weekly or monthly random up-and-down movements get smoothed out. Ultimately, this is where long-term investors should be focused.
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Most of the time, economic data is fairly benign. I don't wish to imply it is meaningless, but it is not a driver of stock markets. Indeed, the correlation between economic noise and how equity markets perform has been wildly overemphasized.
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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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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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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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Have a well-thought financial plan that is not dependent upon correctly guessing what will happen in the future.
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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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Never forget this simple truism: Forecasting is marketing, plain and simple.
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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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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 you hear a discussion about the short-term swings in any given stock's price, your immediate thought should be whether it matters to why you are investing.
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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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Forecasting is simply not a strength of the species; we are much better with tools and narrative storytelling.