Good morning, good afternoon, good evening. Depending on the part of the world you’re in. This is Jonathan Satovsky of Satovsky Asset Management and on today’s episode of “Seeking Wisdom, Wealth, and Wellness,” I want to talk about one of my favorite topics, time versus timing.
People have a tendency to overcomplicate their lives, to make things so much more complicated than they need to be. Simplicity beats complexity. That being said, it just sounds sexier to have complicated stuff going on, to sound busy, to sound like you’re part of the action.
Let me give you some mathematical perspective. January 1, 1996, to September 30 of 2023. If you invested a million bucks in Berkshire Hathaway and you just left it alone, what do you think your return would be? Or for that matter, what do you think your return would be just sitting on it in the stock market – the S&P 500?
During that period we experienced the dot-com bubble, the dot-com bust. We’ve experienced the great crash from ’07 and ’08. We experienced Brexit. We experienced COVID. We experienced all sorts of things.
So what do you think [about] that simple aspect of buying and holding, the S&P or Berkshire for the last 25 years? Well, I’ll give you the answer. With the S&P 500, you’d have over five to six times your money. So, for a million dollars, you’d have about $5.8 million at the end of that time. If you invested in Berkshire, 40% of the time you would have underperformed the markets by magnitudes of 20% to 60%. And yet, at the end of the decade, you’d have $15.5 million.
So, simplify your life on your path to Wisdom, Wealth, and Wellness. Look at the horizon. Ignore the crowd.
Simplify over complicate.
