Ray Dalio’s Teachings for Success
Principles is a book by investor and entrepreneur Ray Dalio. In the book, Dalio outlines several principles that helped him succeed in investing.
For example, one of the principles is to be realist. In short, Dalio explains that facing reality, not creating illusions, is key to dealing with it in the best possible way.
In addition, the author also talks about the importance of possession open mind. That is, put your prejudices aside and be ready to accept new things.
Another important point discussed in the book is that Emotions interfere with decision-making. Therefore, you must be rational and coldly analyze the situation before making a decision.
Anyway, Ray Dalio is a billionaire investor and founder of Bridgewater Associates. Through its investment strategies, Bridgewater Associates has become the largest hedge fund in the world.
That’s why your book is so commented and mentioned in the financial market.
Lessons from the book Principles?
Some lessons from the book are:
1- Computers provide valuable information, but…
Computers have several advantages such as memory, organization and intelligent algorithms. However, the computer does not replace a human in several aspects, such as analysis and empathy.
2- Consider credibility when making decisions
Before you make a decision, ask yourself what your motives are. The intention is to confirm that you are really making the right decisions.
Knowing how to recognize when you’re wrong is key to learning from mistakes and growing.
Namely, when you realize that you’ve made a mistake, you open your eyes to new possibilities that you hadn’t considered before.
3- Principles: What should or should not be
Ray Dalio explains the following: “don’t stick to your views on how things “should” be, because they will make you ignore how they really are”.
In other words, our point of view and emotions often get in the way of seeking objectivity. So, it is important to be rational and realistic and not make decisions based on emotions.
4- Fear of change
Many people would rather stay in their comfort zone than change. One of the reasons for this is the fear of change and what may happen.
anyway, change is necessary and many opportunities can arise with it.
5- Open mind
Finally, another lesson from the book of Principles is the importance of an open mind. With an open mind, you can learn new things and take advantage of opportunities.
On the other hand, a closed person does not learn new things and is not able to see new opportunities.
Other teachings in the book of Principles
Other lessons from the book that you can apply in your life are:
1- Face reality
First, be realistic, grounded and deal directly with the scenario in front of you. This is important so that you don’t make decisions based on your emotions.
A big problem with making decisions based on emotions is that your feelings can affect the way you see problems. In addition, you can make decisions that you will regret later.
2- Seek self-knowledge
Get to know yourself, learn to analyze the facts and draw your own conclusions. For Ray Dalio, this is the best way to make a good choice.
3- Principles: Learn from mistakes
It is impossible not to make mistakes along the way. However, mistakes can serve as opportunities to learn and grow.
So don’t look at a mistake as a disaster. See it as an opportunity to grow and become a better person.
4- Be open minded
Keep an open mind to learn new things and see opportunities that arise. Being open-minded means being willing to accept opinions that differ from your own and to put prejudices aside.
You get a lot more out of an open mind than if you keep your mind closed, thinking you already know everything. Those with a closed mind do not see opportunities.
5- Control your emotions
Finally, ask emotional intelligence so you can control your emotions. In fact, emotional intelligence is crucial in many aspects of your life.
However, when it comes to investing, emotional intelligence is even more important. That’s because without it, you can make bad investment decisions.
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Sources: Portofino multifamily office, Warren and, finally, Guiainvest.
- The Ray Dalio Principles: What We Learned from the Founders of Bridgewater. Multifamily office Portofino. Accessed September 8, 2022.