Aggression to Defense: Howard Marks' Six-Step Roadmap for Risky Times
Last Sunday, I did a deep dive into an important concept called Investcon , introduced by Howard Marks. It’s a crucial idea that can help you navigate market cycles more effectively. Below are my notes on what I read, studied, and found particularly interesting. Happy Knowledge Compounding! Howard Marks uses the term "INVEST-CON" in his investment philosophy to describe different levels of investment readiness, inspired by the Pentagon's DEF-CON system for military alertness. In his recent memos (especially "The Calculus of Value"), Marks laid out a 6-stage "INVEST-CON" hierarchy for navigating overheated markets and extreme valuations. The Six Stages of INVEST-CON Go Short: This is the most aggressive and risky stage, where an investor actively bets against the market by short-selling assets. Marks considers this a near-impossible stage to implement with any certainty, as it requires the conviction that a ...