We try not to have many investing 'rules,' but there is one that has served us well: If we decide we were wrong about something, in terms of why we did it, we exit, period.
Interpretation
Recognizing when you're wrong and making a decisive exit is crucial in investing.
This quote by David Einhorn emphasizes the importance of adaptability and decisiveness in the world of investing. It highlights that investors should not be overly bound by rigid rules; instead, they should be willing to acknowledge their mistakes and swiftly pivot away from unprofitable positions. This mindset fosters a more dynamic approach to investing, allowing for better decision-making based on current realities rather than past convictions.
In practice
This quote can be used in a financial seminar to illustrate the importance of recognizing and learning from mistakes in investing.
The enthusiasm for Tesla and other bubble-basket stocks is reminiscent of the March 2000 dot-com bubble. As was the case then, the bulls rejected conventional valuation methods for a handful of stocks that seemingly could only go up. While we don't know exactly when the bubble will pop, it eventually will.
If not for food stamps, Medicaid, and various job programs, I would never have gone on to be the first in my family to go to college, the first black woman to represent my ward on the Cleveland City Council, and, ultimately, a State Senator.
If you want to create a great product, just focus on one person. Make that one person have the most amazing experience ever.
All that matters in business is that you get it right once. Then everyone can tell you how lucky you are.
Existence is the privilege of effort, and when that privilege is met like a man, opportunities to succeed along the line of your aptitude will come faster than you can use them.
Unswerving loyalty to duty, constant devotion to truth, and a clear conscience will overcome every discouragement and surely lead the way to usefulness and high achievement.
Success isn't something you chase. It's something you have to put forth the effort for constantly. Then maybe it'll come when you least expect it. Most people don't understand that.
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