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Investment Advice: How to invest wisely

A very wealthy friend had a business where he made million. He invested his net worth wisely. Diversifying for long term growth. He also bought and started other businesses. Selling them, most of the time, for a profit. Occasionally not.

He also speculated on some high risk potentially high return investments. Sometimes they hit big. Sometimes they didn't.

As he and I ate lunch at his office one afternoon, I asked him, "So, what is your secret to investing success?"

He responded, "Always keep your core capital safe. From your returns take a little to speculate with if you want. If you hit big, great. If you don't your core capital is secure." Then he gave an analogy I've never forgotten.

"Cash is your admittance to go on the field and play the game. If you run out of cash you don't get to play." I've always remembered that and followed it.