“My job is to write the exact same thing between 50 and 100 times a year in such a way that neither my editors nor my readers will ever think I am repeating myself.”
– Jason Zweig

Writing investment articles can be easy. Stock markets, global economies, and geopolitics continually provide financial journalists with new events and names to insert into stories, allowing many of these articles to practically write themselves. Similar to sports journalism, this daily flow of news and analysis and the willingness of the audience to readily accept the latest sensational views means the authors are seldom held accountable for the outcomes of the bold predictions made.

Unfortunately, the investment articles that are easy for authors to write are usually not helpful for readers. Frivolous commentary that encourages the audience to react based on an emotional response is not helpful because it can often encourage readers to make portfolio changes based on those emotions, which is usually detrimental to portfolio returns.

Writing helpful financial articles is far more difficult. Sound investment recommendations are based not on dramatic news events but on time-tested investment principles and painstaking statistical research. Because the recommendations rarely change, we sympathize with Jason Zweig as he laments the need to reiterate the same, often mundane message in 50 different ways.

We have been writing articles for The Light for ten years now, and from the start we have used anecdotes, current events, and famous quotes to offer different perspectives on the same investment philosophy. For readability purposes, we want it to appear as if we are not repeating ourselves, but most of our commentary is based on the four core investment principles we have advocated from the beginning and will continue to endorse without hesitation: capitalism works, markets work, diversification works, and discipline works.

Capitalism works. Capitalism generates wealth over time. It is the engine powering the tremendous increase in global living standards over the past several centuries. We believe that capitalism will continue generating wealth and improving living standards in the future, and those who disagree should not invest in capital markets.

Markets work. Market prices are determined by the conflicting opinions of well-informed buyers and sellers, and those prices represent the best estimates of fair value. This allows committed investors to profit from capitalism without the need to speculate on individual stocks or the short-term direction of markets. While the market may not always generate the perfect price, it is correct on average. No individual has the ability to consistently determine in advance when the market is wrong, so stop trying to beat the market — just let it work for you.

Diversification works. This is a sophisticated way of saying “do not put all your eggs in one basket.” It is common sense: If risk is spread among many different asset classes, the odds of catastrophic loss are dramatically reduced. Yet investors repeatedly forget this basic principle and instead opt for risky concentrated investments that are comfortable, familiar, or fashionable. Sometimes that works, but it can also produce disastrous results.

Discipline works. Human nature dictates that our emotions influence our decisions. It is therefore imperative that emotion be removed from the equation and a disciplined and dispassionate long-term investment strategy be deployed. You do not want fear to entice you to sell in a panic, greed to tempt you to take on too much risk, or regret to impair your future decision-making ability. The capital markets can be an emotional roller coaster, but you will be rewarded if you can stay in your seat when they drop.

We readily admit that these four principles do not inspire your heart to race, nor will they sell ad space or generate a lot of clicks by themselves. But these core ideas provide a firm foundation to build on, so we have been dressing them up in different clothing for the past ten years to make them more engaging.

If you are a regular reader of The Light, you will continue seeing these four themes in our future writing. Although we might frequently digress to writing about taxes, retirement, or estate planning, when it comes to investing, we will always come back to these four principles. Capitalism will make us wealthy over time if we allow it to. Markets will provide us with fair prices without our having to guess what is coming next. Diversification will protect us from the worst of the bubbles and panics. And discipline will safeguard us from the ravaging effects of acting on emotion. As 2024 rolls along, there will be plenty of easy investment topics for others in the media to write about — hot stocks, frightening international conflicts, and a contentious presidential election. We might even lure you into reading an article by addressing some of these topics, but you will soon realize that we are just saying the same thing we always have.

The original version of this article was written by Heritage for the March/April 2024 edition of The Light, a local magazine serving Broward County, Florida.