Someone forwarded a message on social media listing Murphy’s Laws. One of those caught my attention:
“If everything seems to be going well, you have obviously overlooked something”
In the world of investing, if a risk is not visible, it is a reflection of our inability to see the risk not the absence of the risk.
Exactly the same has happened time and again in the history of financial markets.
This is exactly what happened with Long Term Capital Management (LTCM). (See our post of 31st Dec 2015 on the same).
The problem with LTCM was, the risk was very much there, except that it was not obvious.
#RidingTheRollerCoaster – 61