Comments on: To focus or not to focus, that is the question … http://7million7years.com/2008/09/24/to-focus-or-not-to-focus-that-is-the-question/ How to make 7 million in 7 years ... Sat, 11 Feb 2012 22:32:23 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Jeff http://7million7years.com/2008/09/24/to-focus-or-not-to-focus-that-is-the-question/comment-page-1/#comment-1801 Jeff Sat, 27 Sep 2008 18:30:28 +0000 http://7million7years.wordpress.com/?p=422#comment-1801 @AJC - You seem to talk about focus (as opposed to diversification) quite a bit, but in your newly added video for the why doctors aren't rich post and in some of your comments, you have openly encouraged diversification into real estate. Have you changed your stance? How do you reconcile this contradiction? @AJC -

You seem to talk about focus (as opposed to diversification) quite a bit, but in your newly added video for the why doctors aren’t rich post and in some of your comments, you have openly encouraged diversification into real estate. Have you changed your stance? How do you reconcile this contradiction?

]]> By: AJC http://7million7years.com/2008/09/24/to-focus-or-not-to-focus-that-is-the-question/comment-page-1/#comment-1790 AJC Fri, 26 Sep 2008 20:28:58 +0000 http://7million7years.wordpress.com/?p=422#comment-1790 @ Diane - Agree! There's a HUGE difference b/w persistence and merely perpetuating something that clearly doesn't work ... @ Diane – Agree! There’s a HUGE difference b/w persistence and merely perpetuating something that clearly doesn’t work …

]]> By: Diane http://7million7years.com/2008/09/24/to-focus-or-not-to-focus-that-is-the-question/comment-page-1/#comment-1800 Diane Fri, 26 Sep 2008 18:44:17 +0000 http://7million7years.wordpress.com/?p=422#comment-1800 @ Scott - Well said and I totally agree. Also agree with both points (Scott's and Adrian's), echoed elsewhere, that you have to also be willing to pick yourself up and figure out another way to attack the problem if persistence in one method is not working (i.e., sometimes persistence pays off and other tactics aren't needed, but not always, just don't give up or you're guaranteed not to succeed -- tho all bets are off if you're trying to conceive :)) @ Scott – Well said and I totally agree.

Also agree with both points (Scott’s and Adrian’s), echoed elsewhere, that you have to also be willing to pick yourself up and figure out another way to attack the problem if persistence in one method is not working (i.e., sometimes persistence pays off and other tactics aren’t needed, but not always, just don’t give up or you’re guaranteed not to succeed — tho all bets are off if you’re trying to conceive :) )

]]> By: traineeinvestor http://7million7years.com/2008/09/24/to-focus-or-not-to-focus-that-is-the-question/comment-page-1/#comment-1799 traineeinvestor Fri, 26 Sep 2008 01:25:44 +0000 http://7million7years.wordpress.com/?p=422#comment-1799 I had very mixed views of the Zurich Axioms. Some of the principles I agreed with. Others not. The rule to always play for meaningful stakes is a good one if you are in wealth creation mode (and not wealth preservation mode). The real issues with risk taking is not that it is unavoidable, but (i) that there is no reliable way to measure the probability of success or failure and (ii) it is often difficult to both recognise and accept that you have got it wrong and bail out early enough to preserve at least some of your capital. This means that there is uncertainty over both the potential return, the risk being incurred and other factors. The uncertainty is a good thing for us as investors - it is the uncertainty that creates opportunities to invest with the possibility of achieving above average rates of return. I had very mixed views of the Zurich Axioms. Some of the principles I agreed with. Others not. The rule to always play for meaningful stakes is a good one if you are in wealth creation mode (and not wealth preservation mode).

The real issues with risk taking is not that it is unavoidable, but (i) that there is no reliable way to measure the probability of success or failure and (ii) it is often difficult to both recognise and accept that you have got it wrong and bail out early enough to preserve at least some of your capital. This means that there is uncertainty over both the potential return, the risk being incurred and other factors. The uncertainty is a good thing for us as investors – it is the uncertainty that creates opportunities to invest with the possibility of achieving above average rates of return.

]]> By: AJC http://7million7years.com/2008/09/24/to-focus-or-not-to-focus-that-is-the-question/comment-page-1/#comment-1798 AJC Thu, 25 Sep 2008 17:22:59 +0000 http://7million7years.wordpress.com/?p=422#comment-1798 @ Rick - My choice of numbers was poor in this article (hell, I'd settle for $15M). But, if you had a 95% chance of reaching the stars - whereas the alternative is 'comfortable mediocrity' - would you be willing to go for it? What about 80%? 50%? I would go for it even at 50% (give or take 25%) ... why? Because I'm not committed to this course for life; if it looks like it's failing I'm out early and trying again. @ Rick – My choice of numbers was poor in this article (hell, I’d settle for $15M).

But, if you had a 95% chance of reaching the stars – whereas the alternative is ‘comfortable mediocrity’ – would you be willing to go for it? What about 80%? 50%?

I would go for it even at 50% (give or take 25%) … why? Because I’m not committed to this course for life; if it looks like it’s failing I’m out early and trying again.

]]> By: Rick Francis http://7million7years.com/2008/09/24/to-focus-or-not-to-focus-that-is-the-question/comment-page-1/#comment-1797 Rick Francis Thu, 25 Sep 2008 16:23:13 +0000 http://7million7years.wordpress.com/?p=422#comment-1797 I'm going to be a contrarian here and advocate a middle ground. I agree that there are huge advantages to focusing your efforts- so am I crazy to go in 100% on the highest possible return? No, the trick is that we are NOT considering the risks. There is no sure way of making 15% let alone 35%, so the question really is what is likely? If the all 35% path only gave $29,946,192 5% of the time and $0 95% of the time it wouldn't be nearly as promising would it? It's not easy to predict the odds either- would Bear Sterns, AIG, Morgan Stanley, etc. be in such trouble if they had accurately assessed the risks of mortgage backed securities? Of course if there is no other way in the universe you can reach your number maybe the 5% chance is a gamble you would be willing to take. However, I would be willing to sacrifice some of the upside for a higher overall chance of a good outcome. -Rick Francis I’m going to be a contrarian here and advocate a middle ground. I agree that there are huge advantages to focusing your efforts- so am I crazy to go in 100% on the highest possible return?

No, the trick is that we are NOT considering the risks. There is no sure way of making 15% let alone 35%, so the question really is what is likely?

If the all 35% path only gave $29,946,192 5% of the time and $0 95% of the time it wouldn’t be nearly as promising would it? It’s not easy to predict the odds either- would Bear Sterns, AIG, Morgan Stanley, etc. be in such trouble if they had accurately assessed the risks of mortgage backed securities?

Of course if there is no other way in the universe you can reach your number maybe the 5% chance is a gamble you would be willing to take. However, I would be willing to sacrifice some of the upside for a higher overall chance of a good outcome.

-Rick Francis

]]> By: Bill Ou Yang http://7million7years.com/2008/09/24/to-focus-or-not-to-focus-that-is-the-question/comment-page-1/#comment-1791 Bill Ou Yang Thu, 25 Sep 2008 11:36:03 +0000 http://7million7years.wordpress.com/?p=422#comment-1791 sorry, the article link is http://www.soulshelter.com/2008/08/20/how-to-create-wealth-how-to-keep-wealth/ sorry, the article link is http://www.soulshelter.com/2008/08/20/how-to-create-wealth-how-to-keep-wealth/

]]> By: Bill Ou Yang http://7million7years.com/2008/09/24/to-focus-or-not-to-focus-that-is-the-question/comment-page-1/#comment-1792 Bill Ou Yang Thu, 25 Sep 2008 11:32:52 +0000 http://7million7years.wordpress.com/?p=422#comment-1792 Speaking of "Zurich Axiom", this article also echoes the same premise: Wealth is made in concentration—and maintained in diversification Speaking of “Zurich Axiom”, this article also echoes the same premise: Wealth is made in concentration—and maintained in diversification

]]> By: AJC http://7million7years.com/2008/09/24/to-focus-or-not-to-focus-that-is-the-question/comment-page-1/#comment-1793 AJC Thu, 25 Sep 2008 07:03:29 +0000 http://7million7years.wordpress.com/?p=422#comment-1793 @ Caprica - Thanks. For anybody who's interested in reading this intriguing book, just google "zurich axioms" and the third or fourth entry in the search results should allow you to download a free .pdf version. @ Caprica – Thanks. For anybody who’s interested in reading this intriguing book, just google “zurich axioms” and the third or fourth entry in the search results should allow you to download a free .pdf version.

]]> By: Caprica http://7million7years.com/2008/09/24/to-focus-or-not-to-focus-that-is-the-question/comment-page-1/#comment-1794 Caprica Thu, 25 Sep 2008 00:30:02 +0000 http://7million7years.wordpress.com/?p=422#comment-1794 If you have read the "Zurich Axioms", you will know that the only way to get wealthy is to "specialize". Diversification is how you protect your money, not how you make it. Swiss Bankers obviously know a thing or two. If you have read the “Zurich Axioms”, you will know that the only way to get wealthy is to “specialize”. Diversification is how you protect your money, not how you make it.

Swiss Bankers obviously know a thing or two.

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