Sunday, June 12, 2011

Can we still invest for the long run?

While there are many ways to pursing the process of investing, the following components are critical to all successful strategies: 1) understanding a diversity of market dynamics, 2) assessing probable outcomes and 3) managing risk. Proper execution requires hard work and discipline.

MY TAKE: Given the heightened level of uncertainty currently in the markets, it is worth considering the thoughts of the late financial historian and economist Peter Bernstein from a February 25, 2009 Financial Times piece titled “Insight: The flight of the long run" where he commented, "The unknown today seems more than usually unknown. Then my whole point remains the same. The long run is an impenetrable mystery. It always has been." He also cites John Maynard Keynes' observation about the future: "We simply do not know."

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