The secret weapons of a seasoned investor: Humility and learning

I've been in the investment industry for nearly 25 years now and have learned a lot- most of it the hard way.  Most of it can be distilled down to assuming the following posture:  Stay humble and keep learning.    

Beginning in 2008, I started keeping a list of lessons I've learned about investing.  Some of these come from mistakes I have made and some come from mistakes I've observed others making.   They come from a collection of experiences that range from working on a NY trading desk to being a senior PM of a large global macro fund to running a large family office.   At each stop, I've had the good fortune to work with a lot of good people that were willing to share wisdom.  The best investors I've ever met were able to simplify things to see through the noise.   I dusted my list off today while thinking about what I've learned in the crypto space so far.  Thought I'd share it with everyone who is interested. There's only 26 of them so it shouldn't take long to read!

Would love to hear what you think should be added.

Cheers,

NZFX

1. I can’t see around corners and have significant doubts about those who think they can.
2. Math and history are useful guides but are incomplete without common sense.
3. In the long run, I believe humans + machines will get better results than either one alone.
4. Markets are reasonably efficient, most of the time.
5. There’s a difference between deal guys and investors.
6. Incentives affect human behavior-always.
7. The industry is great at figuring out how to repackage ideas that tripped up investors 1.5 generations ago.
8. Things work until they don’t. Sometimes they start working again.
9. For the most part, people are now throwing the same math at the same data.
10. Human emotions are a significant factor in the investment decision making process.
11. Tail risk is real, often underestimated, rarely prepared for, and highly catastrophic to long term goals.
12. Markets are forward looking.
13. Correlations are highly volatile, unpredictable, and backward looking. Treat them as unstable  artifacts of history.
14. Investors, whether they know it or not, often have multiple goals.
15. I can’t call bottoms but am reasonably confident I know when there’s blood in the water.
16. I’d rather let others try to call the top.
17. Effective diversification is essential.
18. People often start talking about ‘over diversification’ at the end of a cycle, only to regret it later.
19. Having systems set up to minimize mistakes and encourage discipline is a good thing.
20. Risk needs to be diversified across different factor regimes.
21. Distributions are at least as important as averages.
22. Size is the enemy of great returns.
23. A mosaic, stepwise approach to the most important decisions usually pays off.
24. Great performance is damned hard work.
25. As long as fear and greed are part of the human condition, cycles will persist.
26. Be open to new ideas and innovation, as long as they don’t contradict anything on this list!

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