Investment philosophy, how do you form one?

investment philosophy

An important part of your success as an investor is having an investment philosophy.  Even more important than that is adhering to your investment philosophy through both good and bad times.  This week’s “best of the web” starts off with some book recommendations to help you in forming your own investment philosophy.  From there, we cover a mix of things from home buying tips to how ice cream and retirement are related.

10 top investment books for developing an investment philosophy (SeekingAlpha) – If you are a do it yourself investor (or merely want to become more educated about investing), you could do much worse than reading these 10 books.  They will give you a great overview on how to construct a well-diversified portfolio as well as the benefits of doing so.  You will also learn a lot about how to select individual assets.

10 things you didn’t know about millionaires (Money) – Not really an educational piece, but I found some of the facts interesting.

Why the highest offer won’t always get you the house (MSN) – Most people assume highest bid wins in a multiple offer situation.  That’s not always the case.

Why the structural changes to the VC industry matter (Andreessen Horowitz) – While most of you may never invest in the private markets, they can still be fascinating to observe.  Here’s an interesting piece for one of the leaders in the field.

Ice Cream vs Retirement (One Cent at a Time) - Out latest guest post.  It tries to make the simple point that starting to save early matters and even small amounts of money can compound to big amounts over long periods of time.

28 things to avoid at all costs (Motley Fool) – A pretty good list of things that will derail your efforts to achieve your long-term financial goals.

3 sentences that explain investing (ThinkAdvisor) – The title is a little tongue in cheek but it is try that a lot of the most important things to being a successful investor aren’t rocket science.

Cutting corners (Vanguard) – Another piece that emphasizes cutting through the noise and focusing on what really matters.

Are you a saver or an investor? (Time) – We’ve written about our issues with target date funds before, but this article does make a great point that far too many people are playing it too safe to get to where they want to go.  This is just as problematic as being too aggressive.  You need an investment philosophy and that philosophy should be grounded by your goals and what it will take to achieve them.

There really never has been a better time to be an investor (The Big Picture) – As the author clearly states, he isn’t commenting on how the market might move in the short-term.  He’s simply commenting on all the advancements we’ve seen recently that benefit investors.