In Dalio's case, that game was investing: by the age of 12, he had already embarked on a successful investing career that would eventually lead him to found Bridgewater Associates, one of the largest hedge funds in the world.
At a fireside chat hosted by Columbia Business School's Finance Division, Dalio laid out his approach to investing, career growth, and the importance of learning from your mistakes.
“You're going to realize that the only way you learn is by having mistakes and experiencing and reflecting on those mistakes,” Dalio said in a conversation with CBS Senior Lecturer Brian Lancaster.
Chief among Dalio's investing advice was the importance of diversification to mitigate risk. He suggested maintaining a portfolio of largely uncorrelated investments to hedge against significant loss. Dalio also argued for a granular investing approach, identifying sectors that are primed for growth as well as considering global macroeconomic factors.
Drawing parallels between his success in investing and his success as a hedge fund leader, Dalio stressed the importance of knowing one's personal nature and learning through experimentation and humility—something he experienced firsthand through the bear market of 1982, when he suffered significant losses.
“This was painful but maybe the best thing that ever happened in my life because it gave me the fear that I needed to balance with my audacity,” Dalio said.
Similar to his investing philosophy, Dalio advised business professionals to view difficult moments in their careers as part of a larger game, gaining perspective and experience on the road to finding purpose and, ultimately, success. He stressed the importance of surrounding yourself with likeminded people who are able to challenge you.
Forming meaningful relationships throughout your career will help you create “radical truthfulness and radical transparency,” Dalio said, as well as an appreciation for those with differing perspectives.
Scan the QR code below to watch a full video of the event.
