In pursuing financial growth and stability, I’ve embarked on a journey through the dynamic world of investments—a journey shaped by experience, reflection, and developing a personal investment philosophy that resonates with my temperament and aspirations.
Investopedia defines Investment Philosophy as guiding pillars that inform and shape an individual’s investment decision-making process. Each pillar (not in any particular order) represents not just a principle but a reflection of my values and beliefs in navigating the complexities of the market:
Passive Investment
Passive investment holds a special place in my approach, recognizing the value of patience and the compounding power of time. It allows me to focus on other life aspects without looking at the ticker daily.
Convergence of Macro Trend and bottom-up research
Yet, it’s complemented by an active engagement with macro trends and meticulous bottom-up research, where insights converge to unveil hidden opportunities. I happen to follow RAS (Reticular Activating System), lol 😊. The Reticular Activating System (RAS) is a bundle of nerves at our brainstem that filters out unnecessary information so the important stuff gets through.
Longevity
Longevity is not just a distant goal but a constant reminder of the importance of sustainability and resilience. This principle shapes my decisions, ensuring each investment aligns with my long-term objectives and values. I can focus on my learnings, expanding my knowledge base and reapplying them in my life to achieve my personal vision. My Mantra: Learn, reflect, share, and grow.
Margin of Safety
The Margin of safety is a guardian, protecting against market whims and the allure of quick gains. It’s a testament to prudence and discipline, anchoring my decisions in a framework of risk management and preservation of capital. I’m a passive investor and avoid too many frequent decisions. So, for my investment to work, I need an excellent Margin of safety.
Opportunity cost
Opportunity cost is ever-present, prompting me to weigh potential gains against alternatives, mindful of the trade-offs and implications of each decision.
Fearless
Yet, amidst the calculations, a fearless spirit exists—an unwavering determination to confront challenges and embrace uncertainty. If I had done my job thoroughly, I would not have had to follow the herd or be influenced by the media, influencers, etc.
As I continue on this journey, my philosophy will evolve, adapting to new realities and insights gained along the way. As Marc Anderson said, for a 100x outcome, one needs to have a “Strong Opinions Loosely Held” mindset. It would be great to watch how I evolved over time.