As followers of this column are well aware, we have two portfolios, one composed of only Malaysian stocks while the other is a global portfolio (in US dollars). Both portfolios are real — meaning, we put our money where our mouth is. We started the Malaysian Portfolio earlier, in 2014, but, for comparison purposes here, we will assume the same starting point, at the inception of the Global Portfolio in December 2017 (see Table).
We have always maintained that investing in stocks is one of the best ways to build wealth over time, especially for the average person with limited capital to begin with. We doubt many would disagree with this — but the more pertinent question for most, we think, is which stocks to invest in?
One of Warren Buffett’s philosophies is never to invest in a business you cannot understand. Applying this more broadly, your knowledge is your competitive advantage over others that will enable you to maximise returns for the level of risks. Having more information and nuanced understanding, of a market and/or a company, is how you raise the odds of outperforming. And the proof, as they say, is in the pudding.
