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"Can you tell me", asked the investor, "where will the markets go in the year 2009?" My colleague sent me a note: Please can you share with our readers your views on the outlook for 2009?
So, the views are there. And you will receive it on the 5th of January 2009, by when I plan to finish putting my thoughts on paper.
Experience and expert
There are two ways to approaching the investment world: plain luck or having a discipline. These are the two paths you can follow.
And there are two possible outcomes for each of these paths: losing money or making money.
Chances are that following a disciplined path will give you better returns over time. But there are no guarantees that it will work every year. Even the world’s most astute and respected investors and gurus - with very disciplined investment paths - make mistakes and have bad years.
----------- Equitymaster Research -----------
We just had one of those years.
No one can be an "expert" on a stock market. It is a description that I hate being tagged with when I am introduced to someone. But one can say that one has "experience". There is a big difference between being "experienced" and being an "expert".
An "expert" gives the impression that one knows everything and cannot make any more mistakes.
An "experienced" person, on the other hand, has observed events over time and recognises that there is still more to learn. The future will hold surprises.
The "expertise" of an investor is not a clinically achieved milestone of a surgeon. In fact, an investor can never be right 100% of the time. An investor is good if he is right more than 50% of the time - that beats the odds of tossing a coin and relying on the other path of "luck".
An investor achieves a cult like status if he is correct 80% of the time. Yet a surgeon would lose his license and probably end up in jail if he messed up 1 out if every 5 operations!
Power to the people
But while we do not claim any messiah status, we know we are moving along the path of an investment discipline. The outcomes vary year over year, but they should stand us in good stead over time.
And the principles around which we give our judgements and our views stand steadfast: