Unmonetized Lessons

Ted Weschler, one of the top investment managers at Berkshire Hathaway, has accumulated north of $264 million into his Roth IRA as of 2018. Despite outperforming the S&P 500 by hundreds to 1, there were rough stretches of performance, notably in 1990. 

From the Washington Post:

Weschler has put up his amazing numbers despite suffering a 52 percent loss in his IRA in 1990, which makes his record even more impressive.

What happened? To give you the short version, he had a trading profit early in 1990 but then watched his fund’s holdings — Continental Health Affiliates stock and Intelogic Trace bonds — end the year down 67 and 55 percent, respectively, from what he paid for  them.

Weschler said that he kept swinging for the fences despite that whopping loss because, “One of my personal investment mantras is that there’s no such thing as a loss, it’s just an unmonetized lesson.”

While virtually no one can replicate Ted's performance track record, virtually everyone can replicate everything else he applied. Start early, take advantage of taxes and any employer match, invest with a long time horizon and ignore the noise that most other investors subject themselves to. These tenants are the foundation by which everything else is built upon. Without them, Ted never has his name associated with Peter Thiel or is running money for Warren Buffett.

And hopefully, a tough 2022 is viewed as not a loss, but as an unmonetized lesson. One necessary on the journey to earn meaningful returns moving forward.

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^{Source: The simple tricks that turned one investor’s $70,000 retirement account into a $264 million fortune (Washington Post)}