What Would John Templeton Say?

Lauren Templeton and Scott Phillips, coauthors of Investing the Templeton Way, share their analysis of John Templeton’s advice for assessing one’s investing success. This is the second post on this topic; to read the first post, click here.

The time to reflect on your own investing methods is when you are most successful, not when you are making the most mistakes.

During his many years as an investor, Sir John often offered an unconventional perspective or advice on the market.  Often though, this advice would later prove to be uncannily prescient aided by the passage of time.  With that said, simple examples of Sir John’s prescience were revealed over the years, and in many instances these examples were aired in the public space.  One good example comes from the tremendous stock market bubble of the late 1990s, which came to a sudden end in March 2000.  Sir John referred to the stock mania surrounding technology shares as “great insanity” and publicly advised investors of the dangers in the market as well as his own purchase of Canadian and Australian bond strips.  Only later did investors discover the wisdom of his seemingly counterintuitive advice as compared to the overwhelming consensus of stock market bulls.  Given his consistent knack for providing advice whose value was only revealed over time, we might benefit from reviewing his timeless advice to investors.  He provided many examples that are still quoted to this day, but one lesser known quote that fully displays his contrarian wisdom came from November 1978, when he said, “The time to reflect on your own investing methods is when you are most successful, not when you are making the most mistakes.”