76-year-old Dalio bids farewell to Bridgewater, reflecting on departure: pain + reflection = progress
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76-year-old Dalio bids farewell to Bridgewater, reflecting on departure: pain + reflection = progress
He said, "Pain + reflection = progress, ensuring the probability of unacceptable loss is zero."
Navigating Web3 tides with focused insightsAuthor: Ray Dalio
Compiled by: Tencent Finance
Editor's note:
Recently, renowned hedge fund investor Ray Dalio sold his remaining shares in Bridgewater Associates and stepped down from the board, marking the end of a turbulent leadership transition at the hedge fund he founded.
On August 1, Dalio reflected on 50 years of operating Bridgewater in a post on his social media, revisiting his principles on life, work, and investing. He said: "Pain + reflection = progress. Ensure the probability of unacceptable losses is zero."
Below is the full text of Ray Dalio's statement:
Many people have asked me how I feel about the legacy of founding Bridgewater over the past 50 years.
I'm thrilled! I see it as an incredible journey—almost every moment remains vivid in my memory:
From starting Bridgewater with a guy who played football in a two-bedroom apartment, to building it into the world’s largest hedge fund with an outstanding team of about 1,500 people, to generating more profits for our clients than any other hedge fund—and now, as of July 1, completing the final step by passing Bridgewater’s torch to the next generation, whom I firmly believe are fully capable of sustaining the firm’s success and vitality for another 50 years. What a wonderful journey! How deeply satisfying!
Most of all, I’m excited because I love seeing Bridgewater thrive without me—perhaps even better than when I was actively involved. To me, this represents a natural lifecycle. At 76, I’m in the twilight of life. I love Bridgewater and its people (many of whom I’ve worked alongside for decades). From my perspective, this process feels like watching my children grow strong and independent even without me—it’s certainly far better than a 76-year-old parent having to care for their children.
I’ve personally witnessed Bridgewater’s strength evolve over 50 years. Fifty years ago, it was a 26-year-old young man who founded and ran Bridgewater; today, it’s run by individuals 25 to 50 years younger than the current founder, along with those who co-founded it with me and are now leading the firm—especially Bob Prince, Greg Jensen, Karen Karniol-Tambour, and Nir Bar Dea—who are also gracefully living out their own life cycles.
I see these key members continuing to modernize Bridgewater, honoring both the effective principles that built Bridgewater from nothing 50 years ago and the new traditions being shaped by the next generation. This fills me with joy, as I can now freely focus on the exciting and fulfilling things I love. I especially enjoy passing on what I have to others—particularly the principles that once helped me. I still enjoy playing the investment game, cherish having more time with family and friends, find endless joy in ocean exploration, and, like Jacques Cousteau, bring it all to life through media (check out the show “OceanXplorers” on Disney Plus).
At this stage in life, one of my main goals is to pass on the principles that once helped me. So I’d like to share some of the most important ones that drove Bridgewater’s success over the past 50 years. If you’re interested, I’ll also tell you how to learn more. These include principles on how to run an organization and how to make money in markets.
The most important “work principles” I believe drove Bridgewater’s success over the past 50 years are:
1. Get the right people and culture.
2. Select people with excellent character and exceptional abilities, and build a culture of idea meritocracy. Idea meritocracy means achieving meaningful work and meaningful relationships through extreme honesty and radical transparency.
3. Create a culture that tolerates mistakes, but not failing to learn from them.
4. Pain + reflection = progress
To fully understand my work principles, please read my book “Principles: Life and Work.”
The most important investment principles behind Bridgewater’s investment success are:
1. Reality works like a machine, so it’s essential to understand how the machine works and have reliable, sound principles to deal with it effectively.
2. Understand the cause-and-effect relationships driving change, because causes precede effects—understanding these relationships will help you predict what’s coming.
3. Define decision criteria clearly, backtest them, systematize them, then computerize them—so you can execute a well-thought-out and thoroughly tested game plan.
4. Recognize that knowing what you don’t know is far more important than thinking you know everything.
5. Know how to diversify investments well, because doing so allows you to reduce 80% of risk without lowering expected returns.
6. Seek out the smartest people, even if they disagree with you—their thoughtful disagreement stress-tests your thinking, increases your odds of being right, and teaches you a lot.
7. Ensure the probability of unacceptable losses is zero.
If you’re interested in my investment and economic principles, watch for my upcoming book. These principles are also included in the online Dalio Market Principles course offered by the Singapore Institute of Wealth Management—where you can also hear my latest thoughts on investment principles.
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