So the misplaced assumption is that we have this whole new institutional element where these [financial] institutions are looking after their own financial interests before the financial interests of the principals, princi-pals whose interests they are really bound to observe first.

Speculation leads you the wrong way. It allows you to put your emotions first, whereas investment gets emotions out of the picture.

Fund investors are confident that they can easily select superior fund managers. They are wrong.

If you're very talented and keep winning, you'll do just fine. It may take a while. But the talent is hard to identify and talent is hard to tell from luck. There's an awful lot of luck in this business. Past performance is not helpful in judging future performance.

Reversion to the mean is the iron rule of the financial markets.

So the misplaced assumption is that we have this whole new institutional element where these [financial] institutions are looking after their own financial interests before the financial interests of the principals, princi-pals whose interests they are really bound to observe first.

In the long run, investing is not about markets at all. Investing is about enjoying the returns earned by businesses.