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for people that are close to retirement uh that maybe haven't built up enough of a nest egg yet. Do you have any words of wisdom for people in that situation? There are two ways of building wealth. One to save more rather than spending and then make those savings investment into assets that going to have reasonably high returns.
So if you can save more and you have not yet retired, please do so. It's never too late. And usually you want to have a diversified portfolio of many assets. You're going to be overweight uh anywhere. But you know if you still 10 years I would say new economy firms and technology firms are going to do better the same way in which the NASDAQ for the last 30 years has done better than the S&P 500.
So tech related stuff in the industries and firms of the future will be the biggest upside and you can use the max 7 or a broader range of technology firms as a proxy because they're going to invest into all the firms that are in the private sector if you don't direct test to private markets. I would stay away from long duration fix income because in a world of even inflation at 5% rather than two that I don't think is totally unlikely 10-year bondages go from the current four to eight so you're going to lose 40% on the quote safe defensive asset therefore stuff that really hedges you against inflation like short-term treasury tips gold a and other industrial metals and some sustainable real estate might be the good hedge against that in the 6040 portfolio the shorted goes to long teration treasury is a bad idea in this world where you could have higher inflation you need to find a different defensive asset so quality risky assets in the industry of the future and a better defensive asset but I think those are the advice I would give to investors yes now we've spoken about gold we've spoken about the mag 7 AI the explosion in growth over the next 5 years or so they're the areas that people should be looking to invest in but what are some areas they should avoid that you think would have a large price drop over the next few years.
You know, many people want to make a quick buck and by doing quick back they do day trading. You lose money. You know, for one brilliant success story that many people lose money plus, you know, you have to transaction cost and taxes if you trade all the time. Many people go into the gimmicky stuff, the mimi stock, the spax bubble, all the crypto shitcoins and things of that sort.
You know, I I would stay away from all that stuff. You want to be in a diversified portfolio of good assets and you want also to avoid the dinosaurs the firms of the past that are not able to adapt to new technology and are going to disappear. I said many firms in Dow Jones and S&P 500 are not going to survive either.
They adapt to new technology here. Take the example of GE was a multinational conglomerate look like a superstar and essentially falling apart because they made mistakes. So, so many firms got disappear. Of course, S&P can do well because when a firm becomes a dodo in extension, they drop it out of the index and they put the new Nvidia of the world, right?
So, but but still you have to worry about exposure to firms that going to do very poorly that are those of the past rather than the firms of the future. What are the biggest mistakes that people are making regarding money regarding finance investing? It is uh you know investing into stuff is very speculative and volatile doing too much trading as opposed to buy and hold not being enough diversified across classes and globally.
Take a you know an an index passive of global US and global equities and of other assets. Buy and hold it and save into it every month of your life. I've never bought and sold in my entire life a single security just buy passive indices diversified and you know listen on the S&P for the last 30 years I've gotten a 12% return on average per year with all the booms and busts hard to beat that even one of the most sophisticated hedge funds after fees 220 to get a net of 12 you're lucky is that is the exception rather than the rule you know the sophisticated investor don't be an active trader just buy and in a diversified portfolio probably want to be overweight US because US is going to be the dominant economic and technological power of the future.
I still do believe in the American exceptional. So it's simple as that. Not rocket science.
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