By
Borsgade
In this interview, Guy Spier explains that in a randomly selected portfolio held over a long period, most returns come from a few big winners, while many stocks do little or lose value.
He emphasizes the challenge of intervening in a portfolio, as transaction costs and the unpredictability of outcomes often make adjustments counterproductive. Guy stresses the importance of having overwhelming evidence before making changes, noting that Berkshire Hathaway’s success similarly relies on a few key companies.
The principle, if I just pause and self-reflect, is simple to talk about and demonstrate, but it’s far more difficult to act in a way that avoids rebalancing the portfolio. It can be painful.
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In a recent interview, Howard Marks argues that economic forecasting offers little value to investors. He notes that even top investors like Warren Buffett steer clear of relying on economic or market predictions when making decisions.
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