My Holiday Season Gift To You: Wisdom Lifted From the Greats
(AP Photo/Frank Franklin II)
My Holiday Season Gift To You: Wisdom Lifted From the Greats
(AP Photo/Frank Franklin II)
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How can you invest better in 2022?  Learn from the greats who preceded you. Here are some famous minds whose words can aid you in 2022—and far beyond.

“Your ultimate success or failure depends on your ability to ignore the worries of the world long enough to allow your investments to succeed. It isn’t the head but the stomach that determines the fate of the stock-picker.” —Peter Lynch

How did Lynch turn the tiny Magellan Fund into a world-beating juggernaut? Partly by tuning out false fears that scared others from stocks. With a cocktail of worry now brewing—inflation, new COVID variants, looming rate hikes and more—investing success in 2022 requires heeding his wisdom.

“Be fearful when others are greedy, and greedy when others are fearful.” — Warren Buffett

Arguably, the most well-known investing quote—but so many still overlook its lesson. Modern history’s greatest investor knows markets pre-price headline worries—like today’s—lightning-quick. Widespread fear merely tees up positive surprises that fuel bull markets.

“The world is global today and the markets are global today.” — Muriel Siebert

The first woman with a NYSE seat, Siebert knew a thing or two about pushing past boundaries. Investing beyond America expands opportunities while bringing real diversification benefits.

“Investment decisions should focus first and foremost on markets or asset classes. Over time, that’s going to explain roughly 90 percent of investment returns.” — Gary Brinson

Brinson pioneered the theory that asset allocation—how you divide your assets between stocks, bonds and other securities—matters more than exactly which securities you pick. Get the big decisions right, diversify and a lot of the rest just takes care of itself.

“In the short run, the market is a voting machine but in the long run it is a weighing machine.” — Benjamin Graham

Take it from the father of securities analysis: Popular sentiment can make stocks wildly wiggly briefly, but fundamentals prevail over any longer periods that truly matter.

“I buy when things are low and no one wants them. I keep them until they go up, and people are crazy to get them. That is, I believe, the secret of all successful business.” — Hetty Green

Green was a cheapskate’s cheapskate. Born in 1834, she lived in a cold-water, unheated apartment and sewed securities into her dress for safekeeping—and extra warmth. A century before Buffett, she icily waded into stocks during fear-filled crises, dying in 1916 with about $100 million—$2.6 billion by today’s standards. She knew no fear, was dogged, knowledgeable, and a flair for value and sentiment.  She rarely made investing mistakes.

“Bull markets are born on pessimism, grow on skepticism, mature on optimism and die on euphoria.” — Sir John Templeton

Sir John’s description of market cycles is still the best going. Starting this year, I feared euphoria emerging. But it faded this summer into a messy muddle of skepticism and optimism.

“The major risk is not the short-term stock price volatility that many thousands of academic articles have been written about. Rather it is the possibility of not reaching your long-term investment goal through the growth of your funds in real terms.” — David Dreman

Dreman—a money manager and fellow longtime Forbes columnist—knew measuring risk by short-term market fluctuations made zero sense when most people need invest for many years or even decades.

“Those who cry out that the government should ‘do something’ never even ask for data on what has actually happened when the government did something, compared to what actually happened when the government did nothing.” — Thomas SowellSowell, a brilliant economist, and also fellow former Forbes Columnist, was correct to question the widely accepted merits of government “stimulus” or other fix-it plans. As I noted in my June column, no statistical evidence supports the idea that stimulus actually stimulates. None.

“People generally see what they look for, and hear what they listen for.” — Harper Lee

Sure, the To Kill a Mockingbird author wasn’t any investment guru, but she offered a succinct lesson on the “confirmation bias” that derails most investors. Always see viewpoints that challenge your own.

“I know you believe you understand what you think I said, but I’m not sure you realize that what you heard is not what I meant.” — Alan Greenspan

Greenspan, like most central bankers, preserved credibility by rambling endlessly and being impossible to pin down. Remember this the next time you see anyone ascribe big market meaning to current Fed head Jay Powell’s words, or those of any other central banker."Any man who is a bear on the future of this country will go broke.” — J.P. Morgan

Finally, the great one knew.  As long as America has relatively free enterprise and free markets, bull markets will follow bear markets. New investment opportunities will arise—always. Things will irregularly evolve ever better overall , not worse. Bet against it for long and lose. The pandemic proved that yet again to the financial detriment of those not learning the lesson.

Ken Fisher, the founder, Executive Chairman and co-CIO of Fisher Investments, authored 11 books and is a widely published global investment columnist. For more, see Ken’s full bio, here

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