Here are a few quotes that have resonated with us here at Telarray, combined with a brief commentary on why they matter.
“In investing, what is comfortable is rarely profitable.” — Robert Arnott
Rob Arnott is the founder of Research Affiliates, the company that manages our Schwab Fundamental funds you see in your Telarray accounts. We believe that uncomfortable things we’ve done at Telarray, such as maintaining our investment approach even during periods when evidence-based investing is unpopular and insisting our clients stay invested in an appropriate portfolio as much as possible has paid off in the past and will continue to pay off in the future.
“How many millionaires do you know who have become wealthy by investing in savings accounts? I rest my case.” — Robert G. Allen
The urge to go to cash is strong when there is uncertainty in markets, but that’s usually the worst time to do so. Being invested in modern capital markets in the long term really is like magic. Today with 9% inflation, a dollar in cash really does lose significant purchasing power over even a short amount of time.
“Investing should be more like watching paint dry or watching grass grow. If you want excitement, take $800 and go to Las Vegas.” — Paul Samuelson
There is certainly a thrill of investing in the market, but the most successful investors value thoughtfulness and research over impulsive decisions. Even though we don’t have big turnover in our Telarray portfolios, that doesn’t mean we’re not constantly evaluating new and exciting things. We remain most excited by the long term, evidence-based approach of managers at Dimensional, Avantis, and Research Affiliates, which is why you don’t see frequent change in your portfolios.
“Diversification is the only free lunch in investing” – Harry Markowitz
This quote has stood the test of time. At Telarray, we insist on broad diversification as far as factor exposure, international vs. domestic, fund providers, and currencies. With this approach, you’ll never have 100% of your money invested in the best-performing thing, but also you will never be 100% invested in the worst. Different parts of the market outperform at different times, so diversification often can pay off the most when it seems obvious to concentrate everything in one place.
“Know what you own, and know why you own it.” – Peter Lynch
We are not beholden to anyone when it comes to our investment portfolios. We don’t get paid by fund companies, and we’re not captive to a larger organization or insurance company to push certain products. We could put anything in our portfolios, and therefore our investments truly represent our best ideas as a firm.
If you want to know more about why we invest the way we invest, you can watch our recorded presentation of our investment session here: https://telarrayadvisors.com/2022/03/02/march-9-2022-telarray-investment-philosophy/