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Rule #1 - Do not lose money! Rule #2 - Never forget rule number 1! ( by: Warren Buffet )For comments or questions please email: : admin@equityresearch.com |
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AcademicsWhat do academics say about great investment managers like Peter Lynch, Warren Buffet, and Seth Klarman? They say that it is simply an anomaly. They like to take the example of a penny. If you flip a penny a thousand times, you are bound to get a few heads or a few tails in a row. In other words, if you put a bunch of investors together, by sheer luck, some will do better than others. It isn't the result of genius, work, or analysis. It all has to do with luck. This theory of academicians is false. Why is it possible that the same people outperform the market time and time again? Is it really just that someone gets luck for twenty years in a row? The truth is that it is a skill. Some people are better at it than others. The problem with academics is that they can't emulate the results of these investors. Instead of studying what makes these guys great, they write them off as lucky. The other factor is that investing is an art and a science. Like all great artists, you can't just put a put a paintbrush in another persons hand and expect them to paint like Leonardo Da Vinci. Warren Buffet and other top investors don't want to publicize how they do everything because that will make their knowledge less valuable. |
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