Ray Dalio founded Bridgewater Associates, the world's largest hedge fund. He recently sat down for a Reddit "Ask Me Anything" session and shared two key pieces of advice for investors and aspiring investors. For one thing, he believes investors should not solely focus on the hottest stocks and trends in investing – so basically, all of you eying cryptocurrencies and virtual reality – take a step back and think for a moment.
"First, know how to balance your portfolio so that you don't have any systematic bias toward bull or bear markets in anything. Second, don't make the mistake of thinking that investments that have been good over the past few years [will continue]. Rather than more expensive investments… think about how to rotate your portfolio to buy that which is cheap and sell that which is expensive."
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Dalio also discussed the importance of building the relationships in your life. He wrote that those are more important than too much focus the pursuit of graduate degrees. Dalio doesn't believe you get enough value out of an MBA to justify the cost and delay to your career, but you do learn a lot from starting from the ground up. There is more value in those simple experiences. He also stressed that it is vital tomake sure to keep your connections to the people in your life.
"When I look back on my life and the various accomplishments I've made and impacts I've had, the most important source of happiness for me has been the wonderful relationships I've had."
Dalio also told a student how to get the most out of their college experience.
"Party like crazy and don't make the grades your highest priority. Make the friendships and your experiences most important."
Dalio's Bridgewater Associates manages about $160 billion in assets. He started the hedge fund out of his apartment in New York City in 1975. Ray Dalio has a net worth of $14 billion.
