Skip to main content
 386.693.4407  JB@JBirneyFinancial.com
  •  
  •  
  • Client Login

JBirney Financial

JBirney Financial

  • Home
  • Team
  • Services
    • Savings & Income Strategy
    • Insurance
    • Saving for College
    • Estate Planning
  • Resources
  • News and Events 
    • Events
    • Blog
  • Contact

    You are here

  1. Home
  2. Blogs
  3. Why You Need an Investment Philosophy

Why You Need an Investment Philosophy

Submitted by JBirney Financial, Inc. on June 15th, 2017

There are many who would suggest that, in a digitally-wired world in which information travels at light speed to all corners, the investment playing field has been leveled between individual investors and the institutions. In reality, however, the incessant noise and information overload can do more to fuel the irrational behavior of investors than it can to provide any sort of advantage. Absent a principled investment philosophy that guides their decisions and keeps them focused on their own investment objectives, investors are more likely to succumb to the mentality of the herd which can take them over a cliff.

The same can be said for new, tech-driven investment models which can create an overreliance on lab-generated portfolios that can lull investors into a blinding complacency. The problem with many investment models that hypothesize future returns is that they tend to be based on risk calculations that imply knowledge of future uncertainties, which is impossible. They also assume that people, as a whole, will act rationally, which has been disproven time after time. Investors, who are grounded by a foundational investment philosophy, don’t have to rely on flawed investment models or the rationality of other investors.

Successful, long-term investors recognize that media noise only impacts short-term outcomes and investment models don’t reflect real world realities; which is why they stay laser-focused on their investment philosophy. The world’s most successful investor, Warren Buffet, can ignore the noise and crystal balls because he knows they don’t matter. In building one of the most successful investment portfolios of all time, he has strictly adhered to his own investment philosophy:

“Buy wonderful businesses at a fair price with the intention of holding them forever.”

As you can see, an investment philosophy doesn’t have to be intricate or involved. In fact, conciseness is an indication of stronger conviction.

Your Investment Philosophy Guides Your Strategy

Your investment philosophy forms the outer structure of your investment strategy, which should include your clearly defined objectives and the specific practices to be employed. The following philosophy statement clearly encapsulates a long term strategy:

Diversify broadly, stay invested, rebalance annually, minimize investment expenses; rinse, repeat.

All that’s needed is the specific practices or methods for creating a diversified portfolio and rebalancing it as needed to keep it aligned with one’s objectives and risk profile. The part about staying invested could be a little more difficult because that typically requires discipline and patience, which tends to elude many investors. However, having a well-conceived investment philosophy can keep you focused on what’s important and eliminate second-guessing.

In developing your investment philosophy, it would be important to have some insight into some of the more enduring investment principles and practices. With your financial future at stake, it would be well worth your while to read up on some of the most successful investors, such as Warren Buffet, Benjamin Graham, Peter Lynch and John Vogel, all of whom practice strict abidance to their philosophies. More importantly, you need to have a clear understanding of your own objectives and core beliefs about money and risk in order to have the strongest conviction in your investment philosophy.

It would also be important to work with an experienced investment advisor who shares your core values and beliefs about investing. Ideally, your advisor’s own investment philosophy (be leery of advisors who don’t have one), is compatible with yours.

*This content is developed from sources believed to be providing accurate information. The information provided is not written or intended as tax or legal advice and may not be relied on for purposes of avoiding any Federal tax penalties. Individuals are encouraged to seek advice from their own tax or legal counsel. Individuals involved in the estate planning process should work with an estate planning team, including their own personal legal or tax counsel. Neither the information presented nor any opinion expressed constitutes a representation by us of a specific investment or the purchase or sale of any securities. Asset allocation and diversification do not ensure a profit or protect against loss in declining markets. This material was developed and produced by Advisor Websites to provide information on a topic that may be of interest. Copyright 2014-2016 Advisor Websites.

Book a Meeting

Tell a Friend

Schedule a time to meet with us

Contact Us

Additional info

  • Sitemap
  • Legal, privacy, copyright and trademark information

Contact info

  •   Office:
    104 South 4th Street, Flagler Beach, FL 32136
  •   Mailing:
    P.O. Box 268, Flagler Beach, FL 32136
  •   386.693.4407
  •   JB@JBirneyFinancial.com

A Bosses For Babies Business

A Bosses For Babies Business

John T. Birney is a Registered Representative Offering Securities and Advisory Services through United Planners Financial Services, member FINRA/SIPC. JBirney Financial and United Planners are not affiliated.

John T. Birney is registered to conduct securities business in AL, CA, CT, DC, FL, GA, IL, MD, MI, MN, NC, NY, OH, OR, SC, TN, TX and WA.  This communication is strictly intended for individuals residing in the states listed. No offers may be made or accepted from outside the specific states referenced.

Insurance-related services may not be provided to individuals residing in any states other than FL, GA, MD, MI, NC, TN and WA.

A broker-dealer, investment advisor, BD agent, or IA representative may only transact business in a state if first registered appropriately. Follow-up or individualized responses to persons in a state by such a firm or individual that involve either effecting or attempting to effect transactions in securities, or the rendering of personalized investment advice for compensation, will not be made without first complying with appropriate registration requirements.

This material was prepared by Advisor Website, and does not necessarily represent the views of United Planners Financial Services. This information has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. Neither United Planners nor its financial professionals render legal or tax advice. Please seek such advice from your own tax and legal counsel.  If assistance is needed, the reader is advised to engage the services of a competent professional. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

This page contains links to third-party company websites. By selecting a link, you will be leaving our website and launching a new browser window.  These links are provided for informational purposes only and should not be viewed as an endorsement, sponsorship, solicitation or other affiliation with respect to any third parties.  We are not making any recommendations or providing any advise on securities in particular or investments in general. Neither JBirney Financial nor United Planners Financial Services have reviewed the content of, and are not responsible for, the information or the results of the third-party websites.

© 2025 JBirney Financial, Inc.. All rights reserved.

Website Design For Financial Services Professionals