Discipline Wins!!

While I do not agree with Warren Buffet’s approach to investing for most investors. He is a stock picker. However, what I do believe in is his discipline. He has a process and he sticks to it regardless of short term market noise.

Most investors would not be able to endure the volatility of a Warren Buffet portfolio.

This quote will help many investors realize extraordinary results.

It’s not necessary to do extraordinary things to get extraordinary results. Warren Buffet

Everyday there are new financial products generated by the Wall Street bullies. These products are designed to take advantage of the current situation on Wall Street. The short-term market noise should be ignored by successful investors.

Wall Street needs investors to continue moving money. From one product to another. Without regard to what is in the clients’ best interest.

Every day I read about the next great manager or next great strategy. These ‘greats’ are all the result of taking advantage of the current short-term noise in the equity markets.

As an example, during the mid to late 1990s the equity markets were realizing great returns, averaging nearly 39%. In fact, in 1999 they earned nearly 35% and at the same time Mr. Buffet’s fund lost 15%. Mr. Buffet believed in his philosophy and remained disciplined. Many said his time was over he had become irrelevant.

Unfortunately for investors their great returns were followed by the bursting of the ‘tech bubble’. Many lost 80% because they were concentrated in tech stocks. At the same time Mr. Buffet’s had a solid positive return. The reason? Mr. Buffet remained disciplined to his philosophy and flourished.

Most investors need a process to follow, a game plan so to speak. Something to follow during both ups and downs in the markets.

But most importantly they need discipline. The discipline to follow their plan regardless. Many times, it will not look like the thing. However, over the long-term it will serve them well.

This is where a fiduciary adviser/investor coach adds value, or earns their fees if you will. During market extremes, both up and down, provides discipline to help avoid any major mistakes.

To succeed long-term own equities…globally diversify…rebalance.

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