원문 보기
So, Ray Dalio is often framed as a doomer, and he doesn't get the respect I think he deserves. So, let me tell you a bit about him because I think he's up there with Warren Buffett as one of the best investors of all time. Dalio started an investment firm called Bridgewater in a two-bedroom flat in 1975.
Then in 1991, Bridgewater launched Pure Alpha, its flagship hedge fund, which went on to become one of the biggest hedge funds in the world. A hedge fund, if you've not come across the term, is just a firm that manages money for very rich people and very big institutions. It gets paid a slice of whatever it makes them.
Bridgewater has generated roughly 57 billion in net gains for its investors over its history. But, Dalio's track record is what stands out to an investor though, and I'll tell you why. If you invest in the S&P 500, you make money in a rally, and you lose money in a crash. And in a crash year, you could lose big, 20, 30, or even 50% in one of the really bad ones.
Invest with Bridgewater though, and even in a brutal year for the stock market, you might make 9% or more. I'll give you one example. One of his biggest achievements was 2008 when the S&P 500 fell almost 40%. Bridgewater made 9.5% for its clients that year. This is because of Dalio's famous approach to markets.
He builds portfolios designed to do well whatever the market throws at them, and they've been battle-tested for decades. One example is his all-weather portfolio, which we'll talk about later, but as a quick side note, an all-weather portfolio is important as you get closer to retirement because you can't afford a 50% wipeout as you don't have 20 years to recover from that.
Look at the Nasdaq in the dot-com bubble. It lost 78% and took 15 years to recover. If you were 55 when that happened, bye-bye retirement fund. I have my own version of an all-weather portfolio suited to my needs. I'll talk about it a bit more later. Now, let's talk about what he said the other day when he was interviewed by Steven Bartlett, who does the Diary of a CEO podcast.
Bartlett plays Dalio a clip. Watch what Dalio says. If you look at the data, it would be compatible with history for the peak to be very soon. Everything is in line. This is I think the biggest investment bubble in American history. What's your perspective on that? He's right. So, that clip was Jeremy Grantham, by the way.
He runs an investment firm called GMO, and he has an impressive track record himself. I mean, this guy called the dot-com bubble in 2000, the global financial crisis in 2008, even the Japanese bubble back in the '80s. Insane track record, and an underrated great at spotting major asset bubbles. And Dalio just says straight up, he's right.
The biggest investment bubble in American history, and Dalio, one of the few who made money in 2008, just agrees and carries on. But, it's what he says a bit later that actually matters. Are you seeing signs that we're in a bubble? Yeah. Yeah. Yeah. The classic signs that we're in a And the bubble, I should emphasize, it's not a um you're in a bubble or you're not in a bubble.
It's a degree thing. Now, this is something I 100% agree with, by the way. And it's one of the biggest problems in how this stuff gets talked about. When you talk about the AI bubble, it's always black and white. Either you're all in or you're all out. And this is the worst way to think about markets.
The greatest investors don't think about markets in this way. Not Dalio, not Buffett, not Grantham, not even just them. Peter Lynch, who ran the best mutual fund on Earth through the '80s, never thought about the market in this way. Jim Simons, the mathematician who built the most profitable trading firm in history, never thought this way, either.
None of them are all in or all out on markets at any point. And if the bubble itself is a matter of degrees, like Dalio said, then what you do about it has to be a matter of degrees, too. So, the way I like to think about it is this. Picture a slider all the way out on the left, that's every penny in cash.
You have nothing in the markets. All the way in is on the right, that's every penny in the market. Nobody spends a whole career at either end. You sit somewhere between and you move along it as things change. So, sometimes you're further right, sometimes you're further left. Right now, I'm around here, wherever it is.
The editor will put it up on screen. A little bit to the right of center. I have more money in the market than I have cash at the moment. And I'll explain a bit more about this later. But the point is, a bearish outlook doesn't mean zero and a bullish outlook doesn't mean everything is in right now.
Quick thing before you go, I've written a free guide called how to retire before 2036. It's a full 10-year plan for anyone starting late. Get out of debt, invest properly, retire on time. Free download link in the description.
Comments 0