Discipline is Key to Investing Success

According to research conducted by AQR Capital Management, the success of superstar investors such as Warren Buffett and George Soros comes down to a few key strategies. This according to an article in CNBC.com.

In a recent podcast, AQR co-founder David Kabiller said, “One big takeaway from Warren Buffett is: Discipline is really important to being a long-term successful investor,” along with patience and conviction in one’s business strategies. AQR’s research revealed that the Berkshire CEO has relied on three distinct factors throughout his career: “value, quality and limited risk.”

Jordan Brooks, portfolio manager at AQR, weighed in: “There’s a commonality to the performance of all these guys, and the commonality was they had an approach. They had a philosophy and they stuck to it.” He added, “All the factors we look at in this type of a study—every factor I know of—goes through periods of outperformance and underperformance. These managers rode that out.”

“The styles we analyzed have been successful in many contexts—from fixed income portfolio to global macro hedge fund,” wrote the AQR team. “But styles alone aren’t sufficient for success,” they concluded; “they also require patience, ability and a long-horizon to stick with them.”