Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, one by one.
Management is always an exercise in battling entropy. Order tends to disorder and the application of energy is required to restore order. It’s an immutable law of the universe and it’s a law of management. In tough times, the disorder comes at you a whole lot faster and requires a lot more energy to manage.
The most important distinction in the investment world does not separate individuals and institutions; the most important distinction divides those investors that have the ability to make high-quality active management decisions from those investors without active management expertise. Few institutions and even fewer individuals exhibit the ability and commit the resources to produce risk-adjusted excess returns.