We live in a VUCA world fraught with risks of the unknown unknowns kind. These risks can’t be known in advance or be quantified.
How does one invest in such an environment? Should we stop taking any risks? That’s we touch upon in the Lighthouse March 2023.
Recently I happened to come across Mark Spitznagel’s book – Safe Haven – Investing for Financial Storms. I must say my thinking, for now, has been completely upended.
Mark has offered a whole new fundamental framework to think about the world and investing or not investing. In the process, he throws away several modern finance tools out of the window.
I was surprised to know that he considers Warren Buffett to be his greatest influence and Nassim Taleb his mentor. As I read more about Mark (specially his first book – The Dao of Capital), I realize that his sources go further back to a more fundamental Austrian history, what he calls as Austrian Investing, with a roundabout approach to achieve a final goal.
Do read both the books if you can. I believe that they are some of the most important investing literature out there. (updated on March 22, 2023)
In the Lighthouse March 2023 edition, we cover the following:
- What can go wrong, will
- State of the Equity & Bond Markets – What is more attractive now?
- FundTalk – Quantum Gold Fund (Gold is an investment or insurance?)
- Updated Fund Watchlist
- What does the Asset Allocation Indicator along with VIX tell us?
- Finally, 2 more Terms Simplified
Start reading the latest edition below (browser only) or download from here
If you like what you read, do share further with your friends.
I also look forward to your comments and feedback.
I have query on Asset allocation, Value research says that ,we have to invest only equity funds for the goals which are greater than 5+ years. The debt fund can be used for short term goals. Some of bloggers recommend to have Equity: Debt from the start of the portfolio like 60:40 even your goal is longer tenure(10+). What’s your take on that, Should we consider only equity for long term goals. will it add more risk when there is crash or sequence of risk return during the journey of investments
It depends on what kind of volatility you will be comfortable with. I can take on full equity for all my long term goals. Many can’t. I will also be cognisant that when my goals are approaching I need to move money into safe assets and not get greedy.
As an addl point, a 70:30 kind of portfolio can absorb volatility a bit and yet give a large cap index like return.