The one true secret to successful investing

The fact that there is no free lunch in finance underpins modern financial theory. No matter what new innovations come our way –high frequency trading or the blockchain, for two – it will still be true.

THERE’S only one thing you really need to know about investing in 2023, and it’s both stunningly obvious and invariably forgotten: There’s no free lunch.

Sure, everybody knows that with higher expected returns comes the bigger risk of loss. But time and time again investors put this most basic rule to the test in a kind of bull-market delirium. That explains the last blood-curdling year in investing, the last 15 years, and even the last thousand years.