Most investors try to predict the future either thematically, or via their assumptions in a DCF model. They try to pre-position for what they expect to come in the future. But forward visibility is almost always unclear. You are unlikely to be right about either the trend or timing or both.
The better practices is to read the current environment (market temperature, valuations, credit conditions) and let that dictate your posture. In other words, be responsive, not reactive or try to be proactive.
Connections
Link Explanation: A pusher in tennis is a patient player who sits back, returns the ball, and simply lets the opponent make enough mistakes that they lose. This is similar to the investing strategy described as you simply position and reposition based on the field in front of you in order not to lose. Over enough time, you’ll do well in bull markets and survive in bear markets, beating most other investors.
Link Explanation: You won’t find every deal that exists in the universe, but simply by playing the game, you will see massive opportunities. You don’t need to go looking for them, you just need to survive long enough so that you are able to take advantage of the opportunities when they arise.
Reference
🟢 The Most Important Thing Uncommon Sense for the Thoughtful Investor