Motley Fool Money Interview with Barry Ritholtz: How Not To Invest
10 snips
Oct 5, 2025 
Barry Ritholtz, co-founder and CIO of Ritholtz Wealth Management and host of Masters in Business, shares invaluable insights from his book, How Not to Invest. He discusses common pitfalls that can destroy wealth, like emotional decision-making and panicking during market downturns. Ritholtz advocates for a balanced investing approach, suggesting a foundational passive core with selective active strategies. He warns against the Dunning-Kruger effect, where novice investors overestimate their abilities, often leading to poor investment choices.
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Focus On Avoiding Big Mistakes
- Avoid writing another generic how-to investing plan; focus on preventing costly mistakes instead.
- Barry Ritholtz argues that eliminating a few core errors yields far greater gains than more tips.
Winning By Making Fewer Errors
- Amateur investors lose by making unforced errors rather than brilliant plays.
- Barry Ritholtz compares winning as avoiding mistakes to playing conservatively in tennis.
Make Passive The Core First
- Build a passive core (beta) before adding active bets as a smaller portion.
- Use index exposure as your portfolio 'Christmas tree' and add active picks as ornaments.
