The Right Tool vs The Wrong Tool

We live in an area with steep, winding, unpaved roads which become very difficult to drive on in the snow. That difficulty doesn’t prevent people from coming up here in their two wheel drive cars and other unsuitable vehicles and trying. The first picture was taken yesterday at the “100 Mail Boxes” and would be an example of the wrong tool. The Pinzgauer picture was not taken here, I just found it on the internet and think it is neat but that would be an example of the right tool. There are probably several investing metaphors that would work...

Stay On Your Own Mat

Over the years I have posted a couple of tag lines or other little sayings related to the task of investing. Conceptually I don’t think any of them are original but that doesn’t make them any less useful. Barry Ritholtz found a short blog post at the NY Times that hit on a couple of these types of things I have been writing about over the years. One of my tag lines has been stay on your own mat which is a yoga reference about not worrying about how the person next to you in the class does the poses. Ideally a yoga student is focusing on their breathing and trying to make progress at their own pace with the positions. So it is with investing for both do it yourselfers and professionals. We all have our own skill sets, interest levels and only so much time available to spend on the task. You may know someone who routinely makes a killing on three and four legged option combos but that doesn’t make the trades right for you. In this vein the linked article talked about Harvard Management Company buying a dairy farm in New Zealand. Also related (and in the article too) is defining and sticking to your goals not someone else’s. One example from the article was recent Standford MBA grad’s who go 100% equities (not sure if this was a made up example) which might be right for a 25 year old making a lot of money right out of the chute but that is not going to be the right allocation for the typical 50...

Stay On Your Own Mat

Over the years I have posted a couple of tag lines or other little sayings related to the task of investing. Conceptually I don’t think any of them are original but that doesn’t make them any less useful. Barry Ritholtz found a short blog post at the NY Times that hit on a couple of these types of things I have been writing about over the years. One of my tag lines has been stay on your own mat which is a yoga reference about not worrying about how the person next to you in the class does the poses. Ideally a yoga student is focusing on their breathing and trying to make progress at their own pace with the positions. So it is with investing for both do it yourselfers and professionals. We all have our own skill sets, interest levels and only so much time available to spend on the task. You may know someone who routinely makes a killing on three and four legged option combos but that doesn’t make the trades right for you. In this vein the linked article talked about Harvard Management Company buying a dairy farm in New Zealand. Also related (and in the article too) is defining and sticking to your goals not someone else’s. One example from the article was recent Standford MBA grad’s who go 100% equities (not sure if this was a made up example) which might be right for a 25 year old making a lot of money right out of the chute but that is not going to be the right allocation for the typical 50...

Christmas with Taleb!

Over the weekend Barry Ritholtz linked to this profile of Nassim Taleb at The Chronicle of Higher Education. I have mentioned Taleb many times over the years and he has contributed to how I think about certain things both related to the task of portfolio construction and more broadly to life in general. As the linked profile above alludes, Taleb has become in some ways a caricature of himself. We all have our quirks and these quirks often become more pronounced as we get older and that is what I think is going on with Taleb. His latest book is called Antifragile: Things That Gain From Disorder but the writer for the profile said the book “feels like a compendium of people and things that Taleb doesn’t like.” I got a good laugh from that one. The profile goes on to say he doesn’t like academics, sociologists, doctors, Harvard B-school, bankers and economists among many others. He also has specific ideas for what fruit he will and won’t eat and footwear. Assuming the article is correct about these things, it paints an eccentric picture. The earlier posts on this blog about his ideas targeted things that I felt added value and I still think those ideas add value but as a function of his fame we are learning more about him and the value of his contribution might be diluting. As an example, most of what he said in the above article offered no critical value (just entertainment value) but there was something. He said “You cannot rely on external confirmation and have a happy life, I don’t rely on...

Christmas with Taleb!

Over the weekend Barry Ritholtz linked to this profile of Nassim Taleb at The Chronicle of Higher Education. I have mentioned Taleb many times over the years and he has contributed to how I think about certain things both related to the task of portfolio construction and more broadly to life in general. As the linked profile above alludes, Taleb has become in some ways a caricature of himself. We all have our quirks and these quirks often become more pronounced as we get older and that is what I think is going on with Taleb. His latest book is called Antifragile: Things That Gain From Disorder but the writer for the profile said the book “feels like a compendium of people and things that Taleb doesn’t like.” I got a good laugh from that one. The profile goes on to say he doesn’t like academics, sociologists, doctors, Harvard B-school, bankers and economists among many others. He also has specific ideas for what fruit he will and won’t eat and footwear. Assuming the article is correct about these things, it paints an eccentric picture. The earlier posts on this blog about his ideas targeted things that I felt added value and I still think those ideas add value but as a function of his fame we are learning more about him and the value of his contribution might be diluting. As an example, most of what he said in the above article offered no critical value (just entertainment value) but there was something. He said “You cannot rely on external confirmation and have a happy life, I don’t rely on...