With a net worth of roughly $52.1 billion, Mexican billionaire Carlos Slim Helu holds the No. 12 spot on Forbes' 2020 list of the richest people in the world. Slim made his billions by buying stakes in hundreds of companies, mostly through his global conglomerate Grupo Carso SAB. These purchases were often well-timed, as Slim has a knack of capitalizing on crises and knowing when a business is undervalued.
As the world copes with the novel coronavirus and political unrest, listening to the wise words of great investors such as Slim can provide some necessary perspective to help make smart investing choices of your own during these turbulent times.
While Slim has offered lots of advice throughout his career on both investing and building businesses, here are four pieces of wisdom that are especially relevant to investors today.
1. Bad times can present opportunities
All times are good time for those who know how to work and have the tools to do so.
If you read the news about the state of the world, it's clearly a challenging time for many out there. While Slim's quote wasn't about pandemics and political unrest, it's still highly relevant as it shows that even terrible times present opportunities.
While there is nothing good about the novel coronavirus, it does provide the chance to take advantage of stock market downturns for those willing to put in the work to find discounted shares of companies poised for long-term success. For many investors, those bets are already paying off.
Bad times not only present the opportunity to grow your wealth if you're willing to work at it, but also to do good for others if you have the opportunity and wherewithal to help. So use the tools available to you, and aim to make both your portfolio and the world you live in stronger and better when things get tough.
2. Don't panic
Firm and patient optimism always yields its rewards.
Economic and political uncertainty may have you concerned about the future and prompt you to make rash decisions, but this is a recipe for disaster when it comes to managing money or making investments.
Instead, consider buying and holding stocks for the long term, avoiding panic selling during market corrections, not selling prematurely during rallies, and remembering that recoveries always happen is generally the best path forward.
3. Make sure those investments are sound
Courage taught me no matter how bad a crisis gets ... any sound investment will eventually pay off.
This is more than just another reminder to stay the course during troubled times. The key here is that Slim's talking about sound investments.
As recent events have taught us, there's no predicting the future, and black swan events can happen at any time. If you've carefully researched your investments, bought into companies with leadership teams you trust, and made sure you've purchased shares of companies with lasting competitive advantages, your investments should still pay off over the long term no matter what bumps in the road you face.
4. Know what's come before
With good perspective of history we can have a better understanding of the past and present, and thus a clear vision of the future.
As Americans cope with protests and pandemics, it's easy to feel that we're living in a time of unique economic and political chaos and to react accordingly. But a look at a history book shows that's simply not the case.
Understanding what's come before helps put current events into context so you can make better and more informed decisions. Those who understood the history of market rallies and recoveries, for example, were better poised to cope with the market downturn in March without panic-selling their investments and missing out on the rally that followed.
And understanding history doesn't just help you avoid overreacting to market swings. It's one of the keys to picking sound investments, as you can look back at past performance to make more informed choices about whether they're poised for growth.
Take these Carlos Slim quotes to heart
During turbulent times, staying optimistic can be a challenge, especially if you have a hard time putting your own experiences in the context of history. By learning from great investors and businessmen like Carlos Slim, it becomes easier to make the right money moves even in crisis situations.
While doing so may not get you a place on Forbes' list of the world's richest, it should help you to improve your own financial situation so you can get the security you deserve.