The Sun rises in the East.

E = Mc Squared.

Force = Mass * Acceleration.

These are the eternal truths. It does not matter who measures mass and who measures acceleration, the answer remains the same.

Now let us look at Equity market truth

1. Equities give better returns than debt: Normally true, especially over long periods of time. However, salespeople in their enthusiasm to say this include words like ALWAYS, and destroy the truth. Equities can give bad returns in the short run.
2. Debt is safe, Equity is risky – people forget that debt is risky in the long run and equity is risky in the short run.
3. If you are old, you should have more money in debt than in equity.

Much of what passes for absolute statements of truth in our markets are actually statements of opinion valid for that day.

So some Pms manager comes and says “real estate gives better than equity” or “mid cap gives better than large cap”.

When ‘they’ do it is wrong. When we do it, it is an opinion.

However we then say it is an Investment principle.

It is NOT AN investment principle.

Only investment advisers have to struggle with this. Even doctors do not have  to struggle with such vague beliefs.

Organisations and Portfolios are more reliable only and only if they are operated on truth and proper beliefs.

Stop watching TV