Mailbag, incl: Give me a reason for optimism! April 5, 2026
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Trading product launches is a low-probability strategy - success requires predicting both the consumer reception and the market's reaction, which are often decoupled from actual product quality.
“It's diabolically difficult to predict because you're predicting two things. You're predicting the outcome that even the company itself doesn't know... Then you've actually got to predict how people will react to that news.”
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Long-term business viability is easier to predict than short-term price action - betting on whether a dominant company will be larger in ten years offers a much higher margin of safety than guessing next month's stock price.
“Is Samsung around in 10 years time and probably earning more money than it is today? Now, I can't know that either with any degree of certainty... But one is an easier bet.”
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Simplicity often outperforms complex trading wizardry - wealth is most effectively built by buying quality companies and letting compounding work in the 'bottom drawer' rather than trying to be 'too clever' with technical analysis.
“And on average, I've just made out like an absolute bandit because I just let compounding do its thing. And so, there is very much in this game, I think, where you can be too clever, quote unquote, by half.”