Investing Insights: A Superior Approach to Investing Your Money

This is a sponsored column by 3Summit Investment Management, LLC based in Vienna, VA. 3Summit designs custom, modern investment portfolios and has unique expertise in managing investment risk.

By Dan Irvine | Principal, 3Summit Investment Management

I believe investing and gambling are distinctly different activities, therefore I generally shy away from making comparisons between the two.

However, in this case I believe a gambling comparison may be helpful in explaining the advantages that can be gained by investing in what are called quantitative investing strategies.

If you have ever been to Las Vegas and seen the billion-dollar casino buildings, it becomes clear that the house has the advantage. Casino games, by design, put players at a statistical disadvantage. Worse yet, they are also designed to exploit psychological traps, further pushing the odds against players and forcing them into destructive decision-making patterns.

Despite the statistical odds of casino games being against the players, there have been many gamblers who have consistently won in casinos.

Gamblers who have managed to consistently win, have done so by using the same mathematical and systematic approach applied in quantitative investing strategies. Successful gamblers develop a detailed understanding of the psychological traps and the statistical probabilities of the game they play, then create detailed rules that systemize their decision-making process.

Systematic decision-making eliminates the need for the gambler to make discretionary decisions, which can be negatively biased by the emotions that arise from risk taking. The rules created to systematize the playing of the casino game are designed to ensure each action taken by the player maximizes the odds of a successful outcome, thereby getting the odds as close to even as possible.

The odds can never be fully in the gamblers favor, to make winning possible the rules the gambler follows are also designed to manage risk by systematically changing the size of the bets depending on how close to even the odds are for the gambler. This way, when the odds are more favorable the bet sizes are increased along with the potential winnings and when the odds are less favorable, bet sizes are decreased and so are the potential losses.

The gamblers only role in playing the game is to follow the carefully designed system without exception and place bets according to the defined rules. By applying the rules consistently, many people have been successful winning money playing casino games, despite the statistical odds being against them.

Quantitative investing strategies work using the same principles described in the gambling analogy. Strategies are designed within a rigid framework of rules that can be quantified to systematize investment decisions and always seek the highest probability of a successful outcome. Quantitative investing strategies eliminate the single largest point of failure for any investor, emotional decision-making.

Finally, quantitative investing strategies do not use investment expertise to try and predict the direction of markets or individual securities, but instead to design carefully crafted, evidence-based investment rules that are repeatable and can therefore be applied consistently over long periods of time.

Learn More

If you would like professional assistance in evaluating your investment portfolio and strategy, we happily provide free consultations and analysis. Also, consider gaining more unique investing insights by listening to our popular podcast or viewing our investing video series.

3Summit Investment Management is a fiduciary, fee only investment advisor providing clients with an alternative to outdated, conventional investment portfolios. We design custom, modern portfolios capable of delivering greater wealth accumulation with much lower levels of risk. To learn more about how we can help you improve your long-term investing results call (571) 565-2161, email ([email protected]) or visit

Recent Stories

Moss on a tree in Great Falls Park (staff photo by Angela Woolsey) County Approves Automatic Car Tax Filings — “Effective Jan. 1, Fairfax County will now automatically file personal…

Whether you are ready to move-in now or would prefer to personalize a new home from the ground up, Brookfield Residential is here to help make owning a brand new…

A sample design of the county’s redesigned website (via Fairfax County) Fairfax County is refreshing its website. A website redesign is currently underway as the county looks to update “the…

Black Santa will return to Tysons Galleria this weekend (courtesy Santas Just Like Me) Tysons Galleria is getting a triple dose of Santa Claus this December. In addition to the…

Chris Green is one of the DMV’s finest fitness instructors. A Lululemon and South Block ambassador, he is a coach and mentor to so many. He embodies grace, positivity and motivation in ways that no one else can. If we could all learn a thing or two from him, the world would be a much better place. He does so much for others, and does so with a smile on his face 99% of the time.

He recently ruptured his Achilles and has an incredibly long and tough journey ahead. As if COVID hadn’t impacted fitness professionals enough, throw this in the mix and it’s a double, even triple whammy. CG is no longer able to work and do what he loves for the time being because of this and we’d love your support.

Read More

Submit your own Community Post here for just $99.

The Rhea Baker State Farm Agency is proud to support Shelter House in providing safe places to be during quarantine. Shelter House’s mission is to prevent and end homelessness and domestic violence. Right now they are providing over 200 hotel rooms to those in need in our community. In the past year, across all programs, Shelter House served nearly 500 households comprised of over 1,500 individuals, 60% of which were children.

Of the households that exited shelter, over 70% moved to permanent housing. The Baker Agency has served Vienna and Tysons residents and business owners since 2007 and proudly offers insurance solutions for you home, condo, auto insurance, life insurance and more. We offer complimentary reviews and coach teen drivers to safer, better drivers, and to help keep your auto insurance rates down! We are always happy to talk or text at 703-847-6880.

Submit your own Community Post here for just $99.


Subscribe to our mailing list