There is an ongoing exhortation for big investors like pension funds to think "long-term", which presumably means avoiding making irrational short-term decisions (like selling at the bottom).

But there is a cost. If you constrain yourself from being able to take short-term actions, you can't adjust your position if new actionable information appears. Now, if you don't believe you will ever get that actionable information, then fine, lock your investments to the end.

Investing is about information, incentives, and actions.

However, rather than constrain your ability to act (say, by investing in private equity), it is better to fix your incentives. This means retaining the ability to take in new information and act on it while improving the incentives driving your actual decisions.

Successful investing will be about linking more information to faster, adaptive actions, not becoming more constrained.

At Noviscient, our platform approach allows us to access real-time performance information on boutique fund managers, and to model the information and take actions in real-time. 

For example, our real-time risk control significantly reduces our drawdowns compared with monthly or worse decision-frequencies.

You don't know what you don't know, so if you end up in an unexpected situation, being able to immediately close down a strategy can be very valuable.

In other words, instead of artificially constraining the ability to act, construct a smarter, dynamic, and aligned investment framework.

Struggling to raise capital? It’s time to do it the modern way.