In closing his letter about Planned Investment in 1945, John Templeton remarked that “investment planning may cause the invested funds to double.” Rather than advocating for a haphazard, short-term, shoot-from-the-hip mentality toward investing, Templeton advocates patience and perseverance.
So how does one create an investment plan in today’s market? In a 1993 article in World Monitor, Templeton discusses the “16 Rules for Investment Success (and for your family, house, tuition, retirement . . .).” His sixteen rules are:
- Invest for maximum total real return.
- Invest–don’t trade or speculate.
- Remain flexible and open-minded about topics of investment.
- Buy low.
- Search for bargains among quality stocks.
- Buy value, not market trends or the economic outlook.
- Do your homework or hire wise experts to help you.
- Aggressively monitor your investments.
- Don’t panic.
- Learn from your mistakes.
- If you begin with a prayer, you can think more clearly and make fewer mistakes.
- Outperform the market by making investment decisions that are better than the professionals who manage the big institutions.
- An investor who has all the answers, doesn’t even understand all the questions.
- There’s no free lunch.
- Do not be fearful or negative too often.
If advice from 1993 is not current enough, Robert Cole, an investment journalist, at moneysupermarket.com, discusses “Ten laws for first time investors.” While not all of his ten laws are in complete unison with Templeton’s rules, there are many similarities to the lists and both advocate investment planning.