Preserve Capital: The Key to Investment Success

Investors must prioritize capital preservation, especially after a long bull market, as this often becomes overlooked until losses occur. Recognizing that recovering from losses is significantly more challenging than fostering gains, it’s crucial to maintain this focus consistently. Albert Einstein highlighted the strength of compound interest, demonstrating that even modest returns can outperform volatile portfolios that suffer significant losses followed by recoveries. Maintaining steady returns while avoiding losses leads to more manageable and effective compounding over time.