john templeton

guiding principles

• beware of emotions - most people get led astray by emotion in investing by being careless and optimistic when they have big profits and excessively pessimistic and too cautious when taking big losses

• beware of your own ignorance - bigger problem that emotions as many people buy something with the tiniest amount of information and don't understand what they're buying

• diversify broadly to protect yourself from your own fallibility

• be patient

• the best way to find bargains is to study whichever assets have performed most dismally in the past five years, then to assess whether the cause of those woes is temporary or permanent

• don't chase fads