Serious Money is “Not trading or gambling. It is using engineering and real due diligence to deliver terrific returns with certainty” – Jonathan Hirtle
I heard this quote on a recent podcast about the business of investment management. It reminds me of another saying we have at Master’s, “we do not gamble with our client’s money.” Our investment approach is well-researched, steady, void of emotion, and fact centered. We do not make bets, calls, or predictions. Instead, we apply financial science to portfolio management and diligently pursue the efficient implementation of that philosophy. Observe the contrast of a gambler vs an investor:
- Instead of making bets, we make strategic allocations.
- Instead of making calls, we apply rules-based rebalancing.
- Instead of predictions, we make observations.
Investing on behalf of others is indeed serious business. We do not take lightly the responsibility we have to you, our clients, to oversee your well-earned dollars with care. In the book “Other People’s Money” John Kay discusses our society’s need for good banks and investment firms, but the financialization of our economy has led to a void of serious money managers. Instead, we have ended up with a financial sector full of gamblers, traders, and prognosticators.
The point in all of this is to remember that good investing takes time and discipline. It is not easy to ignore the gamblers or the stuff-it-in-the-mattress doomsdayers. If we are not careful, we can be “sucked into” this rhetoric and think that if we are not doing something extreme or complex, we will not be successful.
Serious money is well-balanced and based on simple principles, but the intentionality and discipline it takes over extended periods of time is what makes it difficult. It is the exact reason that most individual and professional investors underperform the market over time.
Our commitment to a serious money approach is what we believe will lead to a positive investing experience over time, and we will help you stay on that ride with us!
When have you found yourself “sucked into” taking a gambling mentality with your money?