Quora Answer: Why is There No Best Way to Invest?

The following is my answer to a Quora question: “Why is there not a best way to invest?”

There is no best way to invest in the same way there is no best car.  Some people like road racing, some like off road racing; some like rally racing.  Investment strategies depend on the investment horizon, risk tolerance, principal capital, investment objective, and the ambient conditions of the market you invest in, and where your investment vehicle is based.

Aside from all the technicalities of putting money somewhere for a greater potential gain, you have to consider your tax liability wherever you are, political risk and currency exposure which is always relative depending on where you are in the world.  That is why people in certain places favour one type of investment or investment strategy over another.  A group of people in a different geographic region would have a totally different preference because of this.

For example, Singapore is one of those places with no capital gains tax.  It is an entirely different matter in Indonesia.  So, Indonesia’s ultra-wealthy tend to invest through vehicles based in Singapore.  But there is creative accounting when it comes to declaring gains.  These actions are not necessarily illegal, but they skirt the border sometimes.