Quarry Hill Insights

Keep doing the right thing (long enough), and diversification pays off.

We bid farewell to another brilliant mind in finance. Daniel Kahneman was a pioneering psychologist and Nobel laureate who left an indelible mark on our understanding of human behavior and decision-making processes.

What makes owning stocks so tricky is you know they will go down, but you just don't know when. Nobody likes seeing their account balance go down, so whether stocks are up or down, the fear of loss is palpable among stock investors.

Dive into a topic that's often overlooked but incredibly vital for your financial well-being: cash reserves!

Are you tired of feeling overwhelmed by budgeting? Do you find it challenging to track where your money is going? You're not alone. Many people struggle with managing their finances effectively, especially as their income grows and expenses multiply. But what if there was a simpler, guilt-free way to spend and save money?

You must understand that the economy can never be consistently forecasted, nor can the market be consistently timed for entry and exit points. To attempt to do so is merely gambling.

The key to progress is staying in the game. Between 1990 and 2020, an investment in the S+P 500 grew from $1,000 to $20,000. Someone who missed just the best 25 days (less than a day per year) would only see their investment grow to $4,000.

How much household income do you think a family needs to be in the top 10%, 5%, and 1% in the United States?

In the world of investing, few figures have left as indelible a mark as Charlie Munger, the renowned vice chairman of Berkshire Hathaway. Munger, one of our heroes sadly passed away recently. He was not only Warren Buffett's longtime business partner but also an intellectual force in his own right.

Emotions are an integral part of the human experience. However, our emotions often cause us to make poor decisions. In the realm of investing, two emotions most commonly accompany bad decision-making: fear and greed

As investors, we are always tempted to extrapolate recent performance indefinitely into the future. Unfortunately, the statistical concept of mean reversion suggests those same outperformers will likely underperform in other years.

If you seek wealth to increase your social status, you will never have enough. The real benefit of wealth, however, is control. Wealth allows you to control the one asset you have that you cannot create any more of: your time!

In the quest for a meaningful and fulfilling life, some timeless principles can be applied to how we manage our finances. These principles, rooted in the human experience and our innate capacity for resilience and need for purpose, can guide us in making wise financial decisions.

Because of our Self-serving Bias, it's easy to fool ourselves into thinking we have more to do with our successes than we actually did. As Richard Feynman famously said, “You must not fool yourself, and you are the easiest person to fool.”

A lot can change in one year, the S&P 500 is up nearly 20%, with international stocks up nearly the same. This recovery took place despite rising interest rates, high inflation, the war in Ukraine, a few bank collapses, and a debt ceiling crisis.

By understanding the relative nature of money, harnessing the power of compounding, embracing frugality, managing emotions and biases, valuing time, and redefining wealth, readers can develop a healthier and more sustainable relationship with money.

No matter how much money you have, you get used to it. The exciting thing is not simply having wealth; it's experiencing the contrast between what you had before and what you now have. Once that contrast wears off, you are adjusted to the new wealth baseline.

The Almanack of Naval Ravikant is a collection of wisdom and insights from the well-known entrepreneur and investor. In the book, Naval shares his thoughts on a variety of topics, including wealth, happiness, and success. Below are some of the key takeaways from the book on how to achieve wealth and happiness

Quarry Hill Advisors' own Bjorn Amundson was interviewed by KTSP on the banking crisis

Silicon Valley startups nearly lost all their cash when Silicon Valley Bank collapsed this month. Almost all of the cash at this bank was uninsured. Had the government not intervened, thousands of companies would have instantly gone up in smoke.