A reader commented that he was 80% equities, 20% cash and referred to himself as bullish. I replied that I was similarly allocated but would describe myself as leaning bearish.

I have commented once or twice that labels such as these, while convenient, tend to be a waste of time. You save and invest for some purpose. You need to stay relatively close to some benchmark over longer periods of time and if you can successfully navigate one down a lot market you will add tremendous value to your long term results.

The media’s quest to label any dip, do you think this is a correction or a more serious bear market, is a huge waste of time. A few weeks ago a reader left a series of comments that were “bearish” in nature. His point of view made sense but I perceived a desire and a priority on his part to be right.

This is a much different mind set than what I think is an easier path for making your way through the market. Anyone participating in the capital markets for any length of time is going to be wrong about a lot of things. I view the task of managing money, whether it is yours or someone else, as capturing most of what the market does (a little better sometimes and a little worse other times) over time, not seeking a moral victory for occasionally making a prescient market call.

The types of things I write about are actually about not having to be right in order to have success. Before you get too caught up in big macro calls, the market has an up year 72% of the time. That fact puts the wind in a lot of our sails and does a lot of work for everyone who goes long.

A lot of things can distract us from what we are really trying to do. Personally, I want to have enough money accumulated for when I need it. That’s it. I don’t remember whether my account beat the market or lagged it in, say, 2003. In a couple of years my result for 2007, personally and for clients, won’t matter. The couple of big-ish macro calls I have been right on before don’t matter now and neither do the big-ish macro calls I have been wrong about.

My goal for clients is similar to my personal goal with the added hope that I can smooth out the ride for them as market conditions dictate.

If you are going to manage your own money I think you really need to know what you are saving and investing for. If you need to smooth out your own ride (not everyone does) you better learn how to do it.

A short term goal is fine of course but most people are investing for something that is long term. Over the long term you are going to be wrong about many things. You only need to be right a little more often than you are wrong and not allow the things you get wrong take you down, that is to say (repeat really) don’t make big bets.

Last 5 posts by Roger Nusbaum

• The Big Picture for the Week of November 15, 2009 - November 14th, 2009
• Process Drilldown - October 23rd, 2009
• Sunday Morning Coffee 10-18-09 - October 18th, 2009
• A Little Followup From This Morning - October 8th, 2009
• Wednesday Roundup - October 7th, 2009