Update- The Wisdom of Great Investors Back in 2009 and after the financial disaster of 2008 that saw stocks and property collapse both domestically and overseas we sent out a series of eUpdates on ‘The Wisdom of Great Investors’ which we have summarized below. As you read each commentary it is important to remember that it is when fear and panic take hold that an investor is presented with the best opportunity to buy more quality assets at reasonable or better still discounted prices. Benjamin Graham (1894–1976) quoted as saying that we should avoid self destructive behavior. Chasing the hot-performing investment category or making major changes to your long-term investment strategy can sabotage your ability to build wealth. Instead, work closely with your financial advisor to outline your long-term goals, develop a strategy to achieve them and set the expectation that you will stick with it when faced with difficult, volatile and challenging markets. Peter Lynch (born 1944) quoted as saying that we should not attempt to time the market. Investors who understand that timing the market is almost impossible will be less prone to react to short-term extremes and more likely to adhere to their long-term investment strategy. Jesse Livermore (1877–1940) quoted as saying that we should be patient. Though periods of short-term volatility for equities are to be expected, it is crucial to bear in mind that historically the sharemarket has rewarded patient, long-term investors. Warren Buffett (born 1930) quoted as saying that we should not let our emotions guide our investment decisions. Be fearful when everyone is greedy and greedy when everyone is fearful. John Maynard Keynes (1883–1946) quoted as saying that we should recognise that short-term underperformance is inevitable. Paying too much attention to daily or weekly performance charts can not only be bad for your health, but also bad for your wealth. John Kenneth Galbraith (1908–2006) quoted as saying that…“the function of economic forecasting is to make astrology look respectable” meaning that you should disregard short-term forecasts and predictions. At Newealth we are always looking to innovate and improve our ongoing services wherever possible and if you have any ideas or comments, please feel free to email me via ‘Contact Us’ at www.newealth.com.au or to call me on +61 2 9267 2322.
25th-June-2013 | 
