The Biggest Investment Mistakes – in the Words of Jean-Marie Eveillard, Howard Marks, et al.

This is a good one on famous value investors and their biggest investment mistakes – check it out.

The Biggest Investment Mistakes – in the Words of Jean-Marie Eveillard, Howard Marks, et al.

We ask most fund managers we interview about investment mistakes, so we have a repository of hundreds of answers.  I’ll highlight just a few:

Howard Marks, co-chairman of Oaktree Capital Management: “…people tend to get in trouble in investing when they have unrealistic expectations, especially when they have the expectation that higher returns can be earned without an increase of risk. That is a very dangerous expectation. Which is the thing which is most dangerous to omit? I think it is risk consciousness.


Voss Capital is betting on a housing market boom

Housing MarketThe Voss Value Fund was up 4.09% net for the second quarter, while the Voss Value Offshore Fund was up 3.93%. The Russell 2000 returned 25.42%, the Russell 2000 Value returned 18.24%, and the S&P 500 gained 20.54%. In July, the funds did much better with a return of 15.25% for the Voss Value Fund Read More

Short-term performance is an imposter. The investment business is full of people who got famous for being right once in a row. If you read Fooled by Randomness by [Nassim] Taleb, you understand that being right once proves nothing. …………………..”

John Lambert, investment manager at GAM: “Compared to most professions, investors suffer a distinct lack of useful information and feedback that would enable them to improve their processes and, ultimately, results. Knowing where and how to make small improvements across the range of skills required to deliver better returns is difficult to do, and consequently it is often put to one side and forgotten. This would be a mistake. ……………….

Mariko Gordon, chief investment officer of Daruma Capital Management: “It’s very important not to be prejudiced and stubborn. You have to be open-minded but you also have to be very disciplined, and grounded, and firm too. […]”

Jean-Marie Eveillard, senior adviser to First Eagle Funds: The single biggest mistake] is not being value investors. Admittedly, it’s difficult not to pay attention to—everybody has a Bloomberg machine or something—not to pay attention to daily changes in stock prices. If you’re an investor in real estate, if you own a few buildings or if you own even one building, you don’t worry about the price of your building on a daily basis because there is no daily transaction. ……………….

See full article by BeyondProxy