Howard Marks, a renowned investor and co-founder of Oaktree Capital Management, is known for his insightful investment philosophy and emphasis on risk management. The quote "You can't predict, but you can prepare" encapsulates one of his fundamental principles in investing. Here's a breakdown of what he means by this statement:
In essence, Marks is advocating for a risk-conscious approach to investing. Instead of relying on predictions or attempting to time the market perfectly, investors should focus on risk management, portfolio construction, and being prepared for various scenarios. Doing so can increase their chances of achieving their financial goals and weathering market volatility more effectively.
Marks' approach aligns with the idea of being a prudent, long-term investor who doesn't get overly caught up in short-term market fluctuations and uncertainties but takes a disciplined and prepared approach to investment decisions.