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Investing Lessons that Have Stood the Test of Time – Part 1

It is rare to find an investor who has been in the stock market for more than 80 years. Late last week, one such investor, Irving Kahn, passed away at the age of 109. Kahn started working on Wall Street in 1928, and was a disciple of the father of value investor, Ben Graham.

With more than eight decades of experience in the stock market, there may be a number of precious investing lessons from Kahn that have stood the test of time.

In this series, I’ve singled out a handful of Kahn’s lessons which I would like to share with you:

Tune out the noise

With the advent of smartphones and connectivity, the flow of information today is far greater than it was in 1928. Kahn was well aware of the noise that this has generated, and had this lifelong observation to share:

“I would recommend that private investors tune out the prevailing views they hear on the radio, television and the internet. They are not helpful. People say ‘buy low, sell high’, but you cannot do this if you are following the herd.”

It turns out that a lot of information out there is rather unhelpful for our future long term returns in the share market.

As my colleague Ser Jing shared before, a study by Vanguard on various popular economic and financial indicators showed that they predicted only very little about future long term stock market returns.

Economic variables and future stock market returns

Source: Morgan Housel at fool.com

In other words, in our quest to beat the Straits Times Index (SGX: ^STI), the private investor cannot afford to be swept up by this gush of information. Instead, we may want to focus on the business behind the ticker.

Kahn has more wisdom to share. Click here to continue on to the next one.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Chin Hui Leong doesn’t own shares in any companies mentioned.