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Highlights of this Chapter – The Mindless Investor Chapter six of The Mindless Investor looks at the advantages that everyday investors have over the bigger players. As it turns out, smaller investors have better maneuverability and lower performance hurdles. What it takes for smaller investors to succeed is a strategy that fits their size. Key […]
Chapter six of The Mindless Investor looks at the advantages that everyday investors have over the bigger players. As it turns out, smaller investors have better maneuverability and lower performance hurdles. What it takes for smaller investors to succeed is a strategy that fits their size.
Often many ordinary investors look at big investors like Warren Buffet with envy – after all who wouldn’t want a portfolio of a few billion dollars? Well, as the song goes ‘mo money, mo problems’. The problem with very large portfolios is that they are difficult to maneuver. In this instance, having a smaller portfolio means you can be nimble and can take advantage of opportunities that bigger players can’t.
Most investors don’t have hundreds of millions of dollars in their portfolio. Large mutual or hedge fund managers need teams of people doing a lot of research and analysis to identify the right kinds of opportunities for the money they work with. As a smaller investor, strategies that are nimble and don’t take a lot of time and resources to use make the most sense to start with.