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Borsgade
In this interview, Ray Dalio highlights that while investors often prioritize buying great companies, they frequently neglect the critical factor of pricing, which can transform even a great company into a poor investment if it’s overvalued.
This issue is especially relevant in a high-interest-rate environment, like the late 1990s, when overvalued assets were prevalent. Dalio emphasizes the need to carefully assess rising interest rates and asset pricing.
Ray also underscores the importance of diversification, as markets are heavily leveraged long, with many relying on asset appreciation. Incorporating uncorrelated assets like gold can help reduce portfolio risk by enhancing balance and minimizing correlation. To navigate market cycles effectively, investors must focus on pricing, interest rates, and diversification.
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Readers are advised that investing may involve a risk of loss that cannot be determined in advance, and that past performance and price development cannot be used as a reliable indicator of future performance and price development. For further information please contact info@borsgade.dk
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