Quote of the Day: Captures the Essence of How We Approach Portfolio Management

If you're at all watching the latest intraday price moves of the equity markets -- not to mention the day-to-day, week-to-week and month-to-month price moves -- I imagine you're getting a feel for the futility of short-term predictions. While technical analyses do play a role in our process, we view the price fluctuations as essentially the wind, while general macro conditions constitute the all-important tide; the latter being what ultimately determines the prevailing risk/reward setup.

I've featured the following Benoit Mandelbrot quote herein before, but it's absolutely worth repeating, as, in two brief sentences, it nicely captures how we approach the portfolio management process: 

"I agree with the orthodox economists that stock prices are probably not predictable in any useful sense of the term. But the risk certainly does follow patterns..."

"The key is spotting the regularity inside the irregular, the pattern in the formless."