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Monday, February 18, 2013

Above average returns are almost never comfortable

Every investor dreams of steady, 10% returns. That burning desire generates poor results because most can't tolerate the discomfort that accompanies such good returns.

Jason Zweig makes this point nicely in his Wall Street Journal article, Value Stocks Are Hot--But Most Investor Will Burn Out.

Excellent returns almost always require being out of step. But, straying from the herd is very uncomfortable. That discomfort tends to build over time until investors cry uncle to end the pain. Then they miss excellent returns.

Don't use steadiness or comfort to judge potential investments or your resulting returns. Great returns come in irregular lumps and from an uncomfortable place.

Nothing in this blog should be considered investment, financial, tax, or legal advice. The opinions, estimates and projections contained herein are subject to change without notice. Information throughout this blog has been obtained from sources believed to be accurate and reliable, but such accuracy cannot be guaranteed.

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