How to make smarter investment decisions in an age of endless information.

By: Daniel Crowley, CFA

Portlfolio Manager, Nightview Capital

For most of market history, market inefficiencies generally stemmed from unequal access to information. This enabled investors with exclusive insights—or faster communication channels—to trade faster than his or her peers.

Now, the game has changed. The internet has democratized information at a scale once seemed unfathomable.  In fact, the dynamic from decades ago has reversed: inefficiencies can arise from an overabundance of information, not a scarcity of information. In a very real sense, the challenge for modern-day investors is no longer access to data itself but rather choosing the correct information to focus on.  

Discernment—knowing what to ignore—is now more important than ever.

But how does one improve this skill?

Learning to separate noise from signal

In refining my investment process, I’ve increasingly embraced the idea of removing unnecessary information from my workflow. I believe that a disciplined approach of “addition by subtraction” is vital, as separating noise from signal has become a crucial aspect of modern investing.

While this has always been the case, the level of difficulty has scaled higher over time. It now requires an active approach to escape the daily deluge of information.

The good news for long-term investors is that, very often, much of what is covered in mainstream media isn’t helpful information for long-term investors.

The benefit of selective ignorance is significant: peace of mind, and, in my opinion, a decent chance at outperformance.

What to ignore if you want to outperform over the long-term

1. Macro Forecasts

Over the past century, the increase in global prosperity has been nothing short of staggering. Yet this same period has seen a constant stream of macroeconomic events that seemed poised to disrupt growth—from wars and recessions to political upheavals and natural disasters. (You could peruse Billy Joel’s “We didn’t start the fire” for an incomplete list.)

If you had panicked—at any given time—you could have missed out on spectacular gains. And while nothing is totally bulletproof, the system has been remarkably resilient over time. Most importantly, economic forecasting has limited utility for long-term market investors. (If economists could predict future events, they’d probably be managing money themselves.)

It’s my view that focusing on well-run companies, with secular tailwinds, has proven time and time again to be predictive and repeatable, while focusing on short-term interest rates and month-to-month industrial numbers has proven transitory—at best.

2. Politics

Politics has become our country’s most popular sport with passionate fans rooting on their cherished team. We, as investors, have the luxury of stepping back from the spectacle of politics to evaluate the economic and technological progress regardless of who is sitting in the Oval Office. The results have, at least historically, been conclusive: the growth of the U.S. economy has continued unabated through all political parties in power.

Source: FRED St. Louis

Ultimately, the mechanisms of supply and demand, investment, technological innovation, and consumer behavior play a far more pivotal role in shaping economic landscapes than political interventions.

3. Doomsday Scenarios

For decades, a niche financial industry — what I term “the apocalypse industrial complex”— has thrived on forecasting economic ruin.  The message often articulated by intelligent and highly persuasive individuals is simple:  the end of prosperity is near, and you should be afraid. Very afraid.

These predictions may include (but are by no means limited to) hyperinflation, market crashes, government collapse, nuclear war, asteroids, etc.

As a general rule, if the feared outcome involves the complete collapse of the economic system, it’s not worth excessive worry—especially if the message is delivered in the form of a paid newsletter.

In such catastrophic scenarios, traditional investments would likely be the least of one’s concerns. Fixating on these extreme possibilities detracts not only from quality of life, but also genuine opportunities which have consistently presented themselves to patient long-term investors.

What do these three items have in common? They play on a central emotion – fear – and disrupt long-term investing. By generally ignoring these three things, I believe one can dramatically increase chances of long-term investment success.  

So, where does this net out for long-term investors? Here are a couple of practical takeaways.

A. Curate Information Sources

Choose information sources carefully that offer high-quality, relevant insights. Trusted financial news outlets, source documents, research reports and industry publications can provide valuable perspectives without overwhelming you with noise.

While this is a good start, you must actively work to avoid sensational news information as well. It is not sufficient to merely read the good—you must avoid the bad.

We absorb a lot by osmosis. Anything we consume, even passively, has an effect. The famous quote “If you’re not paying for the product, you are the product” bears mentioning here.

B. Develop a Routine

Simple mindfulness and awareness about what information we are consuming is a helpful step. Similar to bringing awareness to what food you consume on a diet establish a routine for consuming information.

Allocate specific times for reading news, analyzing reports, and reviewing your portfolio. Attempt to slow down the information ingestion process. This helps prevent information overload and ensures that you stay focused on what matters most.

In an era where information is both abundant and overwhelming, the key to successful investing lies in the ability to filter out the noise and focus on the essentials. By embracing a disciplined approach of “addition by subtraction,” investors can avoid the pitfalls of doomsday scenarios, macroeconomic forecasts, and political distractions that often play on our fears and disrupt long-term strategies.


This has been prepared for information purposes only. This information is confidential and for the use of the intended recipients only. It may not be reproduced, redistributed, or copied in whole or in part for any purpose without the prior written consent of Nightview Capital. The information contained in this article is distributed for informational purposes only and should not be considered investment advice or a recommendation of any particular security, strategy or investment product. Certain economic and market information contained herein has been obtained from published sources prepared by other parties. While such sources are believed to be reliable for the purposes used herein, Nightview Capital does not assume any responsibility for the accuracy or completeness of such information. Further, no third party has assumed responsibility for independently verifying the information contained herein and accordingly no such persons make any representations with respect to the accuracy, completeness or reasonableness of the information provided herein. Unless otherwise indicated, market analysis and conclusions are based upon opinions or assumptions that Nightview Capital considers to be reasonable.