By definition, being contrarian – both in life, and as an investor – is difficult. Going up when the rest of the world is going down, or going right when everyone else is going left, defies the natural human instinct to fit in.
But being a contrarian is what made Jim Rogers one of the world’s best investors. He co-founded the Quantum Fund – one of the world’s most successful hedge funds – which saw returns of 4,200 percent in ten years.
Later Rogers drove around the world – twice. He wrote several excellent books that blend travelogue, investment insight, and political commentary. Today, Jim is viewed as a founding father of the boots-on-the-ground approach to investing in emerging and frontier markets. (He also happens to be a fellow Singapore resident and regular Asian Wealth Daily reader.)
I recently sat down with Jim for an extended one-on-one, exclusive interview. (you can get immediate access to the full, Jim Rogers unplugged video, by clicking here). A few excerpts are below…
Jim Rogers on when to sell
Me: Jim, we’ve talked about buying… how do you know when to sell an asset?
Jim Rogers: Well… when people are getting hysterical, you can sense it just by market action… if you read the press you can see when everybody’s talking about whatever it is that’s the best thing, something going to change everybody’s life… and how boy, it’s a whole new era… You hear the same words every time, every time, they are the same. Investors and the press use the same expressions about how great things are now. [For example,] Amazon can never go down, and will never go down and is going to go own the world someday.
When you hear all that kind of talk… I mean, fortunately or unfortunately, I have read about a lot of markets in my day and they always say the same thing. Absolutely, “a new era.” Oh, how many new eras have we had in history? It’s just amazing.
Me: So you’re talking about really using history to interpret the current market.
Jim: Yes… If you understand history, you’re probably going to be a much better investor. You’re going to be a much better at everything if you understand history, because it all happened, this all happened before. I assure you, we all put our trousers on one leg at a time, and we always have, and we always will.
But you need to understand the basics of how the world works and the best… A good way to do that is to know about what has happened before. And, if you know what’s happened before then you’ll probably be a step ahead of figuring out what’s going to happen.
Why you should move to Asia (or at least learn Mandarin)
Me: If you look at the world, and you look at languages, and you look at economies… if you were to try to target those parts of the world that in 15 years, 20 years will have taken a bigger step than other parts of the world, where would you go?
Jim Rogers: Well, you should definitely go to Asia. I moved to Asia. In 1807, if you were smart, you’d move to London. In 1907, you should have moved to New York. Well, 2007, you should have moved to Asia – which is when I moved to Asia.
Because for my children, the best skills I can give them are to speak good Mandarin and to know Asia. It’s not going to make them successful, I assure you. There are plenty of people in the world who speak Mandarin and who know Asia that aren’t successful. But it will give them a leg up. And if I were a bright young man or woman now, that’s what I would do, I’d go to Asia. Learn at least one Asian language. Mandarin is the best as far as I’m concerned. But I would certainly head to Asia.
During the rest of our interview, Jim also talked about some of the biggest mistakes he’s made, both in life and in markets… one of the biggest dangers of success… and some of his favorite markets today.
For the full interview and Jim’s thoughts on investing in Asia… click here.