Learning To Live Or Deal With Doubts Is A Hallmark Of A Good Investor

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Learning To Live Or Deal With Doubts Is A Hallmark Of A Good Investor
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 Learning to live or deal with doubts is a hallmark of a good investor by David Merkel, CFA of Aleph Blog

I try my best at Aleph Blog to phrase things in a way that conveys my level level of certainty.  But I have my doubts.  Learning to live or deal with doubts is a hallmark of a good investor.

So as the stock price drops, drops, and drops again, what do I do?  I reread the fundamental data to see what I might have missed.  I read contrary opinions.  Then I ask the question: knowing what you know now, would this qualify to be in the portfolio?  If not, I sell it.  In rare cases, if I think it is unfairly trashed, I will make it a double-weight.  So far, I have not lost on anything I made a double-weight.

All investing involves doubt.  We don’t know the future; we are making educated guesses at best.  Am I sure about future earnings?  No.  Do I know what industries will outperform?  No.  In general I have done well with both, but it is an art, not a science.

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