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Is it necessarily the wrong lesson?

Stanley Druckenmiller: my risk management strategy is to put all of my eggs into one basket and watch it very closely.



It is the wrong lesson, but to prove that to the students, you have to rejig the experiment where their picks are compared to those of a primate picking stocks at random.


For those who don't know: Druck compounded capital at over 30% for 30 years. Never had a down year.


The point is that for the purposes of the lesson the time horizon is too short to know if a student got lucky or made a good decision based on research and the like.

Anecdotally I won one of these leagues in school by picking penny stocks and moving in and out of them a lot. Not the lesson in long term investing the teacher wanted to convey…




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