Interesting Words from Leon Boris

Some words of wisdom from a Stocks and Shares ISA millionaire who achieved multi millionaire status from investing a mere £300,000 between himself and his wife. 

"Investing is buying time for yourself."

"If you keep doing something, eventually, the luck will come"

"Good companies remain good companies for a long time."

"The problem with investing is that it's really deferred gratification."

"Dogmatic belief combined with an aggressive personality, I think, is the fastest way to get to zero."

"You've got to accept that you might be wrong, and a lot of people have various biases in their nature where they don't really want to accept that they could be wrong."

"People tend to either suffer from irrational exuberance and get carried away to the upside, or be too depressed about things on the downside."

The introduction of machinery allowed for a more efficient economic system that created new opportunities. Modern technology is likely heading in the same direction and will bring about new opportunities. There is a risk that your monetary returns for your labour is going to be reduced. This means you might want to be thinking about balancing this reduction with capital; reap the benefits from your labour (time putting in work) as well as get a return on your investments. It is quite importnt that people have a stake in society. There is a real threat of people getting a lower return for the work they do whilst not having access to capital, and this will introduce a lot of social friction within society. Capitalism works best when everyone feels vested and benefitting from it.

While holding down a full time job, it is wise to keep only a handful of investments in your portfolio. You should really get to know those companies inside out, so there are no surprises and it gives you confidence holding those shares. Where possible, be involved in those companies; know their products, use their products, understand the business, be motivated by the brand, because when it comes to reviewing the company there will be a level of natural interest that keeps you engaged.

Picking a winner is always difficult. Within new industries there might be hundreds of companies in the beginning, but only a couple will survive. Look at the automobile and the internet for examples. We are currently in a transition stage of AI and robotics, food supply and advancements in health care. There will be a small number of winners that will see stock price rocket in the near future. But there is no clear winner yet. Whoever is able to find the gem of a company that is currently trading low, small cap but is set to go exponential, then that is the ultimate 9x pathway. And I would risk £3,000 to see a 9x, because if it can 9x it'll probably 30x given time.

Your biggest holding probably shouldn't exceed 10% of your portfolio. If that company fails, no matter how good it looks on paper, you don't want it to ruin your portfolio to the point of significant unrecoverable disaster.

Leon Boris Quotes:

"Diversification Vs Di-worsification - Getting involved with businesses you know less and less.

"Let's say you have 10 investments and you lose one; it goes from 100 to zero. Well, that's terrible. But other investments might go from 100 to 1,000. There's no limit to the upside, but there is a limit to the downside. Ensure you haven't got all your eggs in just one basket by having a number of baskets and you get used to the idea of running running profits, something which human beings find incredibly difficult to do. Running profits simply means, when you're winning with a good stock, don't look to sell it. If you do sell it when it rises many fold, just top slice it; sell 10% of it. Maybe another 10% when it increases further, but but generally good companies stay good companies for a long time."

"The problem with investing is that it's really deferred gratification, and human beings do have a problem with deferring their gratification. You only have to look at the build-up of credit card debt; people want things now. Sometimes they've got genuine needs that have to be met "now" and therefore they don't want to defer it. But if you are able to put money away and you invest it wisely, you're building up a real opportunity to have freedom as you get older."

"Dogmatic belief combined with an aggressive personality, I think, is the fastest way to get to zero if you're investing. Some people will get lucky and it'll come off, but for most people, I don't think it's the sensible approach."

"You're typically not in control of the business. You own a percentage of it, but you're not in control. Therefore, you've got to make assessments about the quality of the people who are running it day to-day and their integrity and their ability. It's a different skill set to entrepreneurship, but nonetheless, there's a crossover point as well between the two."

"You have to be an optimist, but the market teaches you humility. You can't dominate the market. You can't tell it "I want to be a millionaire by this age" and it delivers. No matter how hard you work it's not going to happen. If the market goes the other way it's going to be very difficult for you to meet your objectives. You've got to accept that you might be wrong, and a lot of people have various biases in their nature where they don't really want to accept that they could be wrong."

"Periods of volatility like this are always interesting because there are chances to buy things that are much cheaper than they would have otherwise have been. And people tend to either suffer from irrational exuberance and get carried away to the upside, and being too depressed about things on on the downside."