Entrepreneur & Investor.
Entrepreneur & Investor.
timing and investment performance

Issue #16: Timing and Investment Performance

NOTE: this was a past issue of my weekly newsletter, Timeless Gems. Join my free mailing list so you don’t miss out on future issues.

Today’s gem is this chart displaying 2 scenarios of 20-yr investment performance:

  1. starting in 1960 and beating the market by 5%
  2. starting in 1980 and underperforming the market by 5%.

It’s the old “luck vs skill” debate. Uncomfortable truth, but luck plays a major role in investment success. Being in the right place at the right time can make or break a career. This is probably why we know so many legendary investors that got their start in the 80s/90s and virtually none that got their start in the 60s/70s.

The lesson here is: Market outcomes are out of your control. Focus on your process and maintaining the longevity to see many markets. And never let investment success get to your head ;).

I took this chart from this blog post (fantastic read!).