- So today we have legendary investor Jim Rogers on.
- For those of you who don’t know him, Jim used to run a hedge fund with George Soros. Super successful, retired at age 37.
- Travelled the world, twice, once on his motorcycle and once with his wife. Now this is long before Instagram and global travel was a thing.
I actually grew up reading Jim Rogers’ books: Investment Biker and Adventure Capitalist. This was way back, more than 10 years ago.
- Jim probably doesn’t know this, but back in the days when I used to work for my family’s fund, we used to pay very careful attention to what Jim Rogers said. I reckon he has a terrific understanding of the commodities markets, gold in particular.
- I’ve learned so much from his interviews over the years, for example in Market Wizards.
- Now before Jim gets all modest and tells you that he’s a terrible market timer, let me beg to differ. I think he’s a pretty good market timer. I remember 2013 gold crash to $1180. He was the only one who said that gold one go down 1 more leg.
So before we start this interview, I’d just like to say thank you Jim. You don’t know this, but you’ve been really helpful to my trading career.
So Jim, tell us a little bit about yourself. How did you get started in the markets?
- Fundamental analysis
- How do you do your research?
How do you feel about technical analysis?
- I remember you saying in Market Wizards that you don’t believe in that stuff.
How do you feel about diversification
Stop loss? How do you know when you’re wrong on a position?
You taught a course at Columbia.
- Tell us what that was about?
- That’s where I got the idea first from “learning from history”. Deriving fundamental patterns from hisstory
How do you find value?
“Whenever I buy or sell something, I always try to make sure I’m not going to lose any money first. If there is very good value, then I’m probably not going to lose much money even if I’m wrong.”
Importance of doing nothing
“One of the best rules anybody can learn about investing is to do nothing, absolutely nothing, unless there is something to do. Most people – not that I’m better than most people – always have to be playing; they always have to be doing something.”
Identifying tops is harder than identifying bottoms
- Your gold short. A few days from the top, but very far in terms of price
- Would you reconsider going short, since you’ve had that experience? Timing the top of a bubble is very hard, and shorting is even harder b/c of margin call. You can be right in terms of market outlook, but still be wiped out by margin call
How to time an investment
- You like to buy things that are “cheap” or hated. That’s partially why you were bullish on commodities at the turn of the century.
- In Market Wizards you were referring to “timing” an investment. Looking for a catalyst, after the fundamentals support your investment. Can you tell us a little more about that? How do you time? E.g. German stocks
You like to buy things that are hated. But what if it’s hated for a good reason? How do you prevent yourself from “catching the falling knife”?
How do you avoid value traps?
- Eg the fundamentals should be more important than sentiment. buying something just because other people are selling doesn’t make sense
Successes and Failures
Gold, commodities outlook
- How do you understand gold? Gold doesn’t have classic supply/demand because most of it is speculation and central banks
Current market outlook
- U.S. stocks
- emerging market, chinese stocks
- u.s. bonds
- currencies e.g. USD
- Rich people leaving China, Xi Jinping President for life (changed the Chinese constitution)
How do you think this equities bull market will end?
Finally, do you have one last piece of advice to give to people who want to become BETTER investors?
How can people find you?