Ray Dalio warns of great disruptions, shares tips for new investors

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Ray Dalio warns of great disruptions, shares tips for new investors

Ray Dalio speaks during the 2023 Forbes Iconoclast Summit at Pier 60 on June 12, 2023 in New York City.

Taylor Hill | Getty Images

US billionaire Ray Dalio says new investors should have a diversified portfolio as economic and geopolitical headwinds continue.

“I would like to see diversification because what I don’t know will be much bigger than what I know,” said Dalio, founder of one of the world’s largest hedge funds, Bridgewater Associates.

“Diversification can reduce your risk without reducing it much if you know how to do it right,” he said at the Milken Institute’s Asia Summit in Singapore last week.

“Pay attention to the impact of the major disruptions that will take place, because the world will be radically different in five years. And it will be radically different year after year,” he explained.

It’s like living through a time jump. We will be in a different world. And the disruptors are disrupted.

Ray Dalio

Founder, Bridgewater Associates

The development of artificial intelligence has also caught the attention of the hedge fund manager – but Dalio said he recommends investors put their money in companies that are adopting this new technology, rather than those developing it.

“It’s like we’re going through a time jump. We will be in a different world. And the disruptive factors are disrupted,” Dalio said. “I don’t have to choose those who develop the new technologies. I really need to select those who will make the best use of new technologies.”

Asia, an “exciting region”

Speaking to the audience at the summit in Singapore, Dalio said the city-state was a “very special place in a very exciting region.”

“The world landscape is changing, the world order is changing… And because Singapore is essentially a hub, it’s a great place to live.”

When asked about the growing number of family offices being established in Singapore, Dalio listed the top three considerations to take into account when choosing a country to invest in.

A country must have a good profit and loss account and balance sheet, an environment of civility in which “the people….” [are] “We work together to do good,” he said. The side the country represents in the event of an international conflict is also an important factor to consider, he added.

He stressed that the biggest mistake investors make is “believing that markets that have performed well are good, not more expensive, investments.”