During times of crisis, fairweather investors get shaken out if things for which they lack conviction. I try to think about this fact in both good times and bad. When I’m making a buy decision, I ask myself, “will I hold, or perhaps even add to the position, when times are bad?”
With clouds overhead, here are where my convictions remain unchanged.
The first is software. Software is permeating every corner of every industry in every geographic region. One can never be sure, but it seems likely this trend will continue. (holdings: CRM, CNSWF, SHOP)
The second is e-commerce. People will continue to buy more and more things online. Feels like another safe bet. (holdings: AMZN, BABA, SHOP, MELI)
Third is gold. One of the most constant and predictable financial realities is the continued inflationary policy of the Fed. Fiat currencies, since the dawn of time, have suffered from continuous debasement. Thus, in a world of paper money and infinite QE, gold feels like a necessary component of a sound portfolio. (holdings: GLD)
Finally, is an investment in oneself. This takes countless forms, but for me it means reading books, interacting with people smarter than me, and exploring avenues to grow our company.
And on that last point, I can think of 2 factors that make it, far and away, the most important investment of all.
First, the measuring stick is internal (hopefully). You’re putting in work to be a better version of yourself.
Second, there’s no cost of entry. Whatever your station in life, you have the ability to invest in yourself, at least to some degree.
(I don’t have a clean categorization for 2 of my largest individual positions, both of which I’ve been adding to. Those are BRK.B and MKL. These are anchor positions due to impeccable leaders, impeccable discipline, impeccable track records, and bulletproof balance sheets.)