In this episode, Larry Swedroe shares nine critical lessons that the markets taught investors in 2024. Drawing from decades of experience, Larry explains why market forecasts consistently fail, why valuations can’t be used for market timing, and how seemingly obvious economic events often lead to surprising market outcomes.
Larry dives deep into the concept of “self-healing mechanisms” in markets, explaining how periods of poor performance often set the stage for strong future returns. He uses fascinating examples from reinsurance to value stocks to illustrate this principle. The discussion also covers why “Sell in May and Go Away” is a dangerous myth, why active management continues to disappoint, and why proper diversification means always having some parts of your portfolio that aren’t performing well.
Larry also explains why investors keep making the same mistakes and how they can break free from common behavioral biases.
The conversation includes practical insights on:
- Why even a perfect economic crystal ball wouldn’t help you predict markets
- The dangers of judging investment strategies by their outcomes rather than their process
- Why patience and discipline are crucial for investment success
- How to think about diversification in a world dominated by large tech stocks
Whether you’re a seasoned investor or just starting out, this episode offers valuable perspectives on building resilient portfolios and avoiding common investment pitfalls.
