Fewer Losers, or More Winners?
The Memo by Howard Marks
00:00
The Importance of Asymmetry in Superior Investing
Superior investing relies on asymmetry, having more upside than downside. Alpha allows exceptional investors to modify probability distributions and achieve better risk adjusted returns. Skill enables some investors to outperform by emphasizing aggression or defensiveness, depending on their type of alpha. Very few investors possess both forms of alpha, but those who lack alpha can't expect to generate superior risk adjusted returns.
Play episode from 32:22
Transcript
