The Memo by Howard Marks
Fewer Losers, or More Winners?
Sep 12, 2023
Howard Marks discusses the choice between more winners or fewer losers in investing. He explores risk control in bond investing and the analogy between tennis and investing. The impact of style and execution on outcomes is examined, along with the challenges of keeping up with equity indices. The relationship between risk and returns, the efficient market hypothesis, and psychological factors in investor behavior are also discussed.
35:44
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Quick takeaways
- Avoiding losers is essential in investment to achieve consistent returns and risk control.
- Holding winning stocks is crucial to keep up with equity indices and balance portfolio performance.
Deep dives
The Importance of Avoiding Losers
The podcast highlights the importance of avoiding losers in investment. It shares a story about a dinner with David Van Benscoten, who emphasized consistently solid returns rather than shooting for top-decile performance. This insight influenced the speaker's investment philosophy, focusing on risk control and consistency. By avoiding losers and losing years, winners are more likely to take care of themselves.
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