# Investing Styles and Meta strategy An investmen strategy or style can roughly be defined as the method used to pick investments and construct portfolios. Different strategies have different combinations of: - what the universe of securities is - models and tools for selection across different time frames - the number of securities in the portfolio - concentration and sizing Popular investment strategies are clustered in this ''parameter space'. This is probably the result of different parameters working better in some environments than others. The parameters are first discovered by innovators and then replicated, with slight modifications, by others in the industry. Is it possible that different time periods and different markets/regions create clusters of strategies that work particularly well. In the case of a specific region can we identify which elements of an era make characteristics of a strategy more or less successful. For example: - **Concentrated long-term investing:** Is it possible that concentrated long-term quality investing the result of the maturity phase of the [[Dynamics of Technological Revolutions]] when maturation of the technology results in oligopolies with high profits. - **Macroeconomic investing**: Is it possible that macro investing works best when the largest relative forces in the economy are changes in currencies, commodity prices, government policies, or interest rates? - **Diversified fundamental investing**: Here I mean the likes of Peter Lynch and Wilson who ran money during a similar time period with a similar style. They had 100's of positions on and built these on fundamental stock theses. There was a lot of economic growth and change, so spreading the bets out across various potential winners made sense. - **Concentrated short term**: I don't know what to call the investment strategy described by Gerald Loeb, but that's where the saying "All your eggs in one basket and watch it carefully" comes from. - **Deep Value:** This started, from what I can tell, after the great depression when the Benjamin Graham changed his own investment philosophy. - **Short term, arbitraging, scalping**: Is it possible this is a result of reduced economic growth? More predatory investment behaviour? Changes in successful strategy parameters are the result of changes in the economic system so we should be thinking about investment strategy from a higher level of abstraction. We need to think about [[The connected economic system]] and how we should alter our strategy based on its dynamics. For example, when governments are active in the economy we become more macro oriented focusing on politics, government finances, and macroeconomic variables. When we are entering a new technology revolution we become growth investors, or diversified fundamental. When there is increasing levels of uncertainty in the economic direction we become more diversified, etc. ## Related - [[Investment Strategy]] - [[Investor activity driven by market behaviour]] - [[Seek information when you are stuck]]