16 rules for investment success – John Templeton

Today, I will share John Templeton’s 16 rules for investment success with you. Thanks to Anil Kumar Tulsiram, one of the active members of the Capital Orbit community, for sharing this.

John Templeton (1912-2008) was a legendary investor. Indian investors know Franklin Templeton as one of the old names in the Indian mutual fund industry. Templeton sold his investment management business to Franklin Group in 1992 leading to creation of the Franklin Templeton Group.

To his credit, he had a good investment performance record. He is known for searching far and wide for investments across countries and not only restricting investments to USA, his home country.

One of his famous examples of success is when he bought stocks in 1939. World War II had arrived and the stock market was down. He bought 100 shares in stocks which were selling for $1 or less. Four out of the 104 companies turned out to be worthless while he made healthy profits on the other companies.

John Templeton’s 16 rules for investment success

  1. Invest for maximum total real return
  2. Invest – don’t trade or speculate
  3. Remain flexible and open-minded about types of investment
  4. Buy low
  5. When buying stocks, search for bargains among quality stocks
  6. Buy value, not market trends or the economic outlook
  7. Diversify. In stocks and bonds, as in much else, there is safety in numbers
  8. Do your homework or hire wise experts to help you
  9. Aggressively monitor your investments
  10. Don’t panic
  11. Learn from your mistakes
  12. Begin with a prayer
  13. Outperforming the market is a difficult task
  14. An investor who has all the answers doesn’t even understand all the questions
  15. There’s no free lunch
  16. Do not be fearful or negative too often

 

Recommended Reading

Please note that I have given only the 16 rules without the accompanying commentary. The rule + commentary is a must-read.  For the complete package, I highly recommend that you download and read the 16 rules for investment success – John Templeton PDF.

You can read about his life story.

Read about the bear market of 1939 which coincided with the start of World War II.

Let us become smarter investors and keep learning every day. If you have great articles that the Capital Orbit community can benefit from, do share them at kunal@caporbit.com.

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