The Global Macro Maven Ray Dalio Bridgewater Associates

Chapter 1

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The Global Macro Maven
Ray Dalio

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Bridgewater Associates

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Above all else, I want you to think for yourself—to decide
1) what you want, 2) what is true and 3) what to do about it.
I want you to do that in a clear-headed thoughtful way, so that
you get what you want.
—From the introduction to
Ray Dalio’s Principles1

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n his famous Principles, Raymond, or “Ray,” Dalio tells his employees,
“You learn so much more from the bad experiences in your life than
the good ones. Make sure to take the time to reflect on them. If you
don’t, a precious opportunity will have gone to waste. Remember that
pain plus reflection equals progress.”
This is just one of the manyaphorisms, precepts, nuggets of
wisdom, and practical management tips that the 62-year-old Dalio—
the founder of Bridgewater Associates, the global macro fund that is
the world’s largest hedge fund, with $120 billion under management—
emphasizes time and time again. Bridgewater advises and runs portfolios for the most powerful pension funds, central banks, and countries
around the world. In fact, arecent study by London-based research
firm Preqin shows that Bridgewater is the most popular hedge fund
among public pensions.
If you did a quick search on Dalio, you’d be flooded with stories of
his firm’s success in the markets (including generating its best returns
in the most difficult markets of the last decade) and get a fair dose of
his philosophy on life and management. For example,Dalio has been
practicing transcendental meditation for more than 40 years and calls it
“the single biggest influence” on his life.
You’d also find that his most important maxims involve his relentless “pursuit of truth” and hunger for “personal evolution.” His unwavering focus on these goals has no doubt affected his performance
figures and client satisfaction for the better, but has earnedhim mixed
reviews from employees, some of whom judge his approach as unnecessarily harsh. Dalio is unapologetic. In his Principles, Dalio proudly says,
“I have become a ‘hyperrealist.’”
Dalio is also well known for how his big-picture, innovative thinking has changed investing in important ways. In fact, industry magazine
aiCIO devoted its December 2011 cover story—“Is Ray Dalio the Steve
Jobsof Investing?”—to him, highlighting the similarities between the
two leaders’ motivations and approaches and how each has impacted his
industry. Dalio, like Jobs, feels his life is a journey during which he must
turn his bold visions into reality. Dalio’s industry-changing innovations
have earned him two lifetime achievement awards and won Bridgewater
dozens of “Best of ” awards.
Dalio saysthe form of meditation he practices “is a combination
of relaxation and a very blissful experience. That sounds more like an

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orgasm than it really is; by blissful I just mean that I just feel really
good and relaxed and in good shape. You go into a different mental
state—neither conscious nor unconscious. But unlike when you’re
sleeping, if a pin drops allof a sudden, it can reverberate through you;
it’s shocking.”
It took some time for Dalio to discover a meditation technique he
could master, but eventually he began to notice that even 20 minutes
of meditation could make up for hours of lost sleep. It also began to
change the way he was thinking about things: he became more centered and more creative. Meditation put Dalio in a clear-headedstate
so that when challenges came at him, he could handle them “like a
Ninja—in a calm, thoughtful way.” He says, “When you’re centered,
your emotions are not hijacking you. You have the ability to think
clearly, put things in their right place, and have good perspective.”

The Makings of a Maven
Sitting in his modern Westport, Connecticut, office in a blue Bridgewater polo shirt and...