What we believe about investing
I was going through some old email exchanges between partners at Rhoads Lucca Capital and came across an exchange about what we believe about investing:
- We believe that insight, wisdom, experience and applied intelligence are the keys to success as investors. As such, we believe smart and wise people have an advantage.
- We believe investments should be managed instead of drifting into danger – ultimately, someone has to steer the ship.
- We believe it is just as important to have an defensive strategy as it is to have a offensive investment strategy.
- We believe there are seasons to plant crops and seasons to harvest your gains – both in the physical world and the investment world.
- We believe the more stable the investment strategy, the greater likelihood that investors will stick to it in difficult times. And there will be difficult times.
- We believe that avoiding large losses in the markets is a key to success as an investor. Small losses can be made up quickly. Large losses require very, very large gains to get back to even.
- We believe that investing is not only about making money, but about the part no one talks about – keeping it.
- We believe that consistency of investment return is the unheralded hero of investing. We believe the only way to measure the success of any investment strategy is over a complete cycle of a rising and a falling market. If you want to talk about “beating the market”, then measure over a complete market cycle that lasts for years.
- We believe investment discipline and strategy are the antidote to emotional decisions .
- We believe that the most valuable things command the highest prices – including superior money management. Where else can you buy dollars for 1-2 cents each?