Here at Long Game Investing (LGI) we seek to enable the individual investor to make smart investing decisions just like the pros, despite lack of access to sophisticated financial instruments, investment opportunities designed for high-net worth individuals, and limited time available for meticulous analysis.
We believe that the big decisions are what’s important. We follow a top down approach to look at asset allocation, stock picks, real estate investing, and personal finance.
The most important decision an investor makes is how to divide his money among asset classes. We’ve looked at historical returns and correlations, and developed passive portfolios that minimize risk through diversification while achieving high returns.
We also look at economic indicators that have shown historical correlation with market performance and risk. By looking at these, an active investor can reallocate his portfolio on a regular basis to attempt to gain excess returns.
The simplest way for an individual investor to gain exposure to different asset classes is through index funds. We’ve identified those that correlate best with their intended market indices and which offer leverage that allows individual investors to carry out more sophisticated strategies.
We don’t rely heavily on picking individual stocks. It can be a fool’s errand to devote hours and hours of time to analysis trying to beat the market, only to find that broad market trends typically dominate long term returns.
We do however allocate a small portion of our stock portfolio to individual stocks, if only because it allows us a diversion that prevents us from succumbing to the psychological pitfalls of investing which lead most active investors to buy and market highs and sell at lows – exactly the opposite of the goal.
We identify value stocks using the time-tested approach of legendary investor Ben Graham – mentor of Warren Buffet – and find attractive growth stocks looking at a combination of earnings growth, technical indicators, and institutional support.
One of the only ways an individual investor can get access to “other people’s money” is through Real Estate. For this reason alone, Real Estate investing, when done carefully, can be a path to financial independence.
We track real estate markets with our primary focus on residential rental properties. By looking at credit conditions, rental market conditions, and economic trends we find the most attractive locations for investing in real estate.
You’ve probably heard a ton of personal finance advice akin to telling you to stop drinking Starbucks and make your coffee at home. That’s all well and good, but a couple dollars a day are not going to add up to a retirement nest egg. We focus on the big decisions that have the most impact on your finances – large purchases such as your primary residence, automobiles, and vacations.
Our Monthly Newsletter
Every month, we publish our latest analysis geared toward enabling the individual investor to make the best decisions. Read the latest issue here.