Expert Insights

Buffett’s famous “Rule 1” of investing is straightforward; don’t lose money. But 10 years into the current business cycle, with unemployment and interest rates at record lows, the window of opportunity for easy returns is closing. Amit Lodha, Portfolio Manager of the Fidelity Global Equities Fund, says that a focus on capital preservation is key. 

“If you’re thinking from a three-to-five-year perspective, which is what I do, I think caution is definitely warranted.” 

But perhaps controversially, Lodha said that recessions can be a good thing for strong companies with outstanding management teams, as it allows them to invest for the future at reduced prices. In the video below, Lodha shares the characteristics of a company that can excel in this environment using a well-known example.

 


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