When investing in a new investment, one of the first questions that I ask myself is the above question:
Am I backing the horse, the jockey or the racecourse?
Am I backing the horse, the jockey or the racecourse?
If I choose to back the racecourse, I think of it as picking a sector (geographical, like China, or sector, like mining). I do this particularly when investing in tracker funds and ETFs.
If I choose the jockey, I'm backing the competencies of a fund manager (of an investment trust, unit trust or OEIC).
If I choose the horse, then I'm basically picking individual shares myself.
Which is best?
As is usual in life, its horses for courses. (groan!)
