Big Mistakes

CHAPTER 6Michael SteinhardtStay in Your Lane

Investors who confine themselves to what they know, as difficult as that may be, have a considerable advantage over everyone else.

—Seth Klarman

Making money in the markets is challenging even when you have a deep understanding of what it is that you're doing. Consider specialized professional financial analysts, for example, who have expertise in one particular industry. Even they often have a difficult time separating the winners from the losers.

With the proliferation of exchange‐traded funds (ETFs) and exchange‐traded notes (ETNs), different parts of the market have become more accessible than ever. But just because we can trade commodities, currencies, volatility, stocks, and bonds doesn't ...