The Coffeehouse Credo
Once you remove yourself from Wall Street’s complete and total obsession with trying to beat the stock market average and accept the fact that equaling the stock market average is a rather sophisticated approach to the whole thing, building a common stock portfolio becomes an immensely gratifying experience.
Wall Street has conclusively proven to us that pursuit of performance above a benchmark is an unproductive use of our time, our talent and our money. By trying to beat the stock market average, it’s easy to forget that the stock market has historically provided an excellent investment return, and by trying to beat an already good thing, investors are virtually guaranteed to end up below it.
The Coffeehouse Principles
- Develop a long term financial plan
- Diversify across different asset classes
- Capture the entire return of each asset class