Hasnain says:

“Marks also underscored the trap of mean reversion — the notion that what goes up must come down, and vice versa. This concept can drive investors to sell prematurely, securing small gains and hunting for the next underpriced stock. This relentless quest for low valuations can result in a portfolio filled with average businesses that could see a 30% uplift when market sentiment changes.

Meanwhile, transformative returns (in the thousands of percent) are usually found in long-term holds. The longer the hold, the less the exact entry-point valuation matters. What's more crucial is the choice of investment and the holding period.

In investing, just as in life, you often get what you pay for.”

Posted on 2023-08-14T03:27:18+0000