The Most Important Thing

Price is critical
The Buzz

In this buzz: “The Most Important Thing“ by Howard Marks and some important and fundamental investing principles …

I recently finished re-reading The Most Important Thing by renowned investor and Oaktree founder Howard Marks. If you haven’t, I would highly recommend grabbing a copy asap. His second book, Mastering Market Cycles is terrific as well, but The Most Important Thing is required reading. If you are familiar with Marks’ books, you can stop reading this, if not I want to reflect on a few of his fundamental principles. Disclaimer, I don’t own any Oaktree investments, so this is basically a book report.

The title is misleading, The Most Important Thing has 20 chapters, each of which covers a different “most important thing” about investing. It’s true in general and maybe it resonates now as they markets seem especially fickle about what is its dominant concern at any given moment.
Is it the ① Fed, ② inflation, ③ recession, ④ earnings, ⑤ politics, ⑥ war? Somedays it seems like all of the above.

Marks is adamant that he (nor anyone) can predict the market with any consistency. He doesn’t try. What he does is…
– assess the current situation,
– try to remain rational and
– place an intrinsic value on assets.
Once valued, he attempts to adhere to Warren Buffet’s mantra of 💡 “being greedy when others are fearful and fearful when others are greedy.”

I’ll leave it to you to read the book on your own, but I will close by paraphrasing one bit of advice.
” Price is critical. A good company is not a good investment at any price. Nor is a bad asset necessarily bad at any price. Well bought is half sold as they old saying goes.”


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