Aswath Damodaran: Your Best Investment Philosophy Is The One That Fits You

Johnny HopkinsAswath DamodaranLeave a Comment

During his recent interview with The Motley Fool, Aswath Damodaran explained why your best investment philosophy is the one that fits you. Here’s an excerpt from the interview:

Damodaran: That’s why I end the book with a statement which is, the best investment philosophy is the one that fits you as a person.

The person you need to understand the most to be a great investor is not Warren Buffett or Peter Lynch, it’s you. You need to know what makes you tick. What makes you comfortable. What makes you uncomfortable.

So I tell investors to keep note of things that happen that make them uncomfortable in their portfolio. What happened today that made you uncomfortable?

Keep a journal because it’ll allow you to understand what it is that makes you uncomfortable and try to reduce that because if you let those discomforts stay on you’re going to get in the way of your own success. You’re going to be selling things too early because you just can’t take it anymore.

So I think understanding yourself is key to being a successful investor and that means being open to the fact that sometimes you look at your portfolio and it makes you really uncomfortable.

We try to push it away. We try to deny it. We try to act like it’s not there. I think it’s a mistake.

You can listen to the entire discussion here:


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