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The Most Important ThingUncommon Sense for the Thoughtful Investor$
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Howard Marks

Print publication date: 2011

Print ISBN-13: 9780231153683

Published to Columbia Scholarship Online: November 2015

DOI: 10.7312/columbia/9780231153683.001.0001

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The Most Important Thing Is … Having a Sense for Where We Stand

The Most Important Thing Is … Having a Sense for Where We Stand

Chapter:
(p.124) 15 The Most Important Thing Is … Having a Sense for Where We Stand
Source:
The Most Important Thing
Author(s):

Howard Marks

Publisher:
Columbia University Press
DOI:10.7312/columbia/9780231153683.003.0015

This chapter is about another vital prerequisite for successful investing: having a sense for where we stand. Market cycles present the investor with a daunting challenge, given that: their ups and downs are inevitable; the investor will profoundly influence their performance as investors; they are unpredictable as to extent and, especially, timing. The best option is to simply try to figure out where they stand in terms of each cycle and what that implies for their actions. The essential ingredient here is inference. Simply put, they must strive to understand the implications of what's going on around them. The key is to take note of things—for example, whether investors are optimistic or pessimistic, whether novel investment schemes are readily accepted or dismissed out of hand, whether securities offerings and fund openings are being treated as opportunities to get rich or possible pitfalls—and let them dictate what to do. This chapter also offers a guide on market assessment.

Keywords:   market cycles, investors, inference, investment, securities, market assessment

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