Key Takeaways

● Jim Rogers traveled on a motorcycle worldwide to get a deeper view of investment opportunities in different countries.

● Rogers maintained that investors should invest only in what they have sufficient knowledge about and be patient.

● His confidence in China guided him to go long on Chinese assets, which generated handsome returns for him.

Jim Rogers is known as the "international investor". He co-founded the Quantum Endowment Fund with George Soros, which became one of the world's most renowned funds. In 1980, Rogers left the Quantum Endowment and embarked on a global road trip, passing many countries, including Portugal, Austria, Germany, Singapore, and Brazil.

"If you believe in an economy, you should take an indiscriminate approach, buying shares across the board," said Rogers. His confidence in China guided him to go long on Chinese assets, which generated handsome returns for him.

Investment Tips from Rogers

Rogers rarely lectures about his investing strategies throughout his career. Still, he'd love to share lessons he learned with people he knew, such as "do what they have knowledge about" and "sit and wait until opportunities appear".

The investment community has summarized seven major investing rules based on Mr. Rogers's experience.

First, work hard.

"As I was not smarter than most people, I was willing to work harder than most," said the legendary investor.

Second, rely on your own intelligence.

"Early on in my investment career, I made the mistake of basing a few important business decisions on colleagues' opinions instead of conducting the research necessary to make an informed decision. Each of those investments ended in failure," says Rogers in his book A Gift to My Children: A Father's Lessons for Life and Investing.

To Rogers, Wall Street analysts are not as insightful as many think. So, he encourages investors to think independently and avoid herd mentality.

Third, do not go to business school.

Rogers once noted that learning history and philosophy, being a waiter, or even traveling to the Far East were more helpful than studying at business school.

He told his students at Columbia Business School that it was a waste of time for them to study here. He maintained they would better spend the $100,000 tuition on making real investments because the heads-on experience would be much more valuable than professionals' empty talks.

Fourth, never lose money.

Rogers believed it might be better for investors to stick with government bonds than to venture into the market without an idea about what they were doing.

"The way you become a successful investor is by investing only in what you have a wealth of knowledge about. Everybody knows a lot about something. Cars, fashion, whatever it is. Just take a look at your daily life. Concentrate on what you know. You will see a major change coming long before anybody on Wall Street will," said Rogers.

Fifth, have faith in value investing.

According to Rogers, value investors will not suffer significant losses even if they do not buy at good timing as they buy in the assets based on their value.

Sixth, have patience.

"I just wait until there is money lying in the corner, and all I have to do is go over there and pick it up. I do nothing in the meantime."

Seventh, know when to do nothing.

"Anytime you think you've become a financial genius – when, in fact, you simply have had the good luck to turn a profit – it is time to sit back and do nothing for a while," said Rogers. "Most successful investors do nothing most of the time because they know when to sit and wait." He regarded himself as an "opportunist" who would act when an opportunity arose.

He warned, "Ignorance is born of an outsized sense of self-importance. Never let yourself become arrogant. Study hard. The more you learn, the more you will realize how little you know - and armed with this humility, you will never lose sight of the distance that separates self-confidence and self-importance."  

Case Studies

The key to Rogers' success lies in his original approach to investing - using an entire country as an investment target. Based on his profound knowledge of history, politics, philosophy, and economics, Rogers analyzed each country during his global road trip in terms of its economy, investment risks, and opportunities in the stock market. Once a country or region was deemed promising, Rogers would invest heavily in that country's assets.

Austria and China are two of Rogers' most classic investments.

Rogers first went to the New York branch of Austria's largest bank, asking how to invest in Austrian stocks, but was told, "We don't have a stock market." Rogers then visited Austria himself and learned that none of the political parties or interest groups opposed foreign investment or opening up their stock market.

From his meetings with the Austrian government officials in charge of the stock market, Rogers learned that the government had realized the capital market's importance and might consider rolling out policies to encourage investments in the stock market.

Rogers sensed the market was a bull-in-the-waiting. He maintained that if you had confidence in a country, you should buy all well-shaped stocks in the market. Through detailed research, Rogers shelled out for stocks of quality Austrian companies, including an interior decoration company, several financial and industrial institutions, construction companies, and a large machinery company.

Rogers' interest in China started from his first visit to China in 1984. According to him, he missed two opportunities to invest in China in 1978 and 1992. So, in 1999, 2005, 2008, and 2013, he increased his positions in Chinese stocks without selling any of his holdings. Rogers continued telling people he knew that the 21st century belonged to China.

He came specially to Shanghai to open a Chinese B-shares account on his second visit to China. Since 2005, he has shelled out for Chinese B shares, H shares (Hong Kong shares), and China concept stocks. He resolutely shorted American stocks like Fannie Mae and even sold his mansion in New York, where he had lived for over 30 years. After moving the whole family to Singapore, his daughters got a better environment to learn Chinese, and he was much closer to the Chinese capital market.

Rogers maintained that investors must follow policies when investing in China. Sectors that received government funding would be attractive assets for Chinese investors. He has made big moves in sectors including agriculture, rail, healthcare, and financial services since 2013. Even having been hit hard by the pandemic, China's tourism, entertainment, and transport sectors were still under his close watch. Furthermore, Rogers was optimistic about the agriculture sector and rural development.

Rogers Quotes

1. Buy low and sell high. It's pretty simple. The problem is knowing what's low and what's high.

2. If everyone thinks one way, it will likely be wrong. If you can figure out that it is wrong, you are likely to make a lot of money.

3. I cannot invest the way I want the world to be; I have to invest the way the world is.

4. Following what everyone else is doing is rarely a way to get rich.

5. The last leg of a bull market always ends in hysteria; the last leg of a bear market always ends in panic.

6. If anybody laughs at your idea, view it as a sign of potential success!

7. I better not invest in what I want. I better invest in what's happening in the world.

8. Bottoms in the investment world don't end with four-year lows; they end with 10- or 15-year lows.

9. If you were smart in 1807, you moved to London. If you were smart in 1907, you moved to New York City, and if you were smart in 2007, you moved to Asia.

10. Get inside information from the president, and you will probably lose half of your money. If you get it from the board's chairman, you will lose all of it.

The Bottom Line

Though almost 80 years old, Rogers is still an active investor whose actions will catch the attention of the global investment world. Recently, when he received an interview from ET Now, a media outlet, he expected a years-long recession, where many countries were likely to struggle with financial difficulty.

"Because we've made so many mistakes this time around, interest rates will have to go very, very high. We will have a serious recession; many people will go bankrupt, and we're going to have a lot of problems. There's no other way to solve the problem other than to have double-digit, Volcker-esque interest-rate hikes," said Rogers.

These words crystalize what he has been preaching: do nothing until investment opportunities appear.


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Any illustrations, scenarios, or specific securities referenced herein are strictly for illustrative purposes. Past investment performance does not guarantee future results. Investing involves risk and the potential to lose principal.