Principles: Life and Work

Ray Dalio

Sep 2017 · Sold by Simon and Schuster

About this ebook

#1 NEW YORK TIMES BESTSELLER * 5 MILLION COPIES SOLD

“Significant...The book is both instructive and surprisingly moving.” —The New York Times

Ray Dalio, one of the world’s most successful investors and entrepreneurs, shares the unconventional principles that he’s developed, refined, and used over the past forty years to create unique results in both life and business—and which any person or organization can adopt to help achieve their goals.

In 1975, Ray Dalio founded an investment firm, Bridgewater Associates, out of his two-bedroom apartment in New York City. Forty years later, Bridgewater has made more money for its clients than any other hedge fund in history and grown into the fifth most important private company in the United States, according to Fortune magazine. Dalio himself has been named to Time magazine’s list of the 100 most influential people in the world. Along the way, Dalio discovered a set of unique principles that have led to Bridgewater’s exceptionally effective culture, which he describes as “an idea meritocracy that strives to achieve meaningful work and meaningful relationships through radical transparency.” It is these principles, and not anything special about Dalio—who grew up an ordinary kid in a middle-class Long Island neighborhood—that he believes are the reason behind his success.

In Principles, Dalio shares what he’s learned over the course of his remarkable career. He argues that life, management, economics, and investing can all be systemized into rules and understood like machines. The book’s hundreds of practical lessons, which are built around his cornerstones of “radical truth” and “radical transparency,” include Dalio laying out the most effective ways for individuals and organizations to make decisions, approach challenges, and build strong teams. He also describes the innovative tools the firm uses to bring an idea meritocracy to life, such as creating “baseball cards” for all employees that distill their strengths and weaknesses, and employing computerized decision-making systems to make believability-weighted decisions. While the book brims with novel ideas for organizations and institutions, Principles also offers a clear, straightforward approach to decision-making that Dalio believes anyone can apply, no matter what they’re seeking to achieve.

Here, from a man who has been called both “the Steve Jobs of investing” and “the philosopher king of the financial universe” (CIO magazine), is a rare opportunity to gain proven advice unlike anything you’ll find in the conventional business press.

Ratings and reviews

A fantastic read with an insightful collection of the authors core principles that have driven his and, in turn, Bridgewater's success over the past 4 decades. What can at time seem like a completely disparate set of guiding principles ends up being a clear view of how the author has used his principles to get him through the trickiest of situations. The book traverses a number of different topics as it moves through the timeline of the authors career. The earlier chapters focus on the formation of many core principles. This includes some of the practices the author implemented to analyse industries right across the entire supply chain to best understand the market drivers and how prices would fluctuate. The work he did with McDonalds to lock in chicken prices through the use of grain futures for a key supplier, enabled them to launch the Chicken McNuggets. Anecdotes and stories of people the author has worked with such as Rusty Olsen, Alan Bond, and Bill Gates give insight into the weight that many outsiders have put on the documentation of these principles and the obvious effect they’ve had on people across the globe. The book does an exhaustive job of going through each principle and explaining with examples its implementation. From recording all meetings to drive transparency, pushing radical openmindeness, leveraging and promoting critical feedback, creating baseball cards for all employees to ensure the best work fit, engaging in psychological assessments of people to understand drivers, best practices for managerial staff, and many more. An underlying theme runs across each of the principles and that relates to relationships.The basic principle that meaningful relationships and meaningful work meant more than money drove the author. The influx of money was incidental, but no doubt welcome. The ups and downs of his career however are testament to this strong underlying driver. Staying the course was a key component to the success experienced. The author mentions the classic 80/20 rule and I think this applies greatly to this book. You may not get through each and every principle and take something from it. You will however no doubt be struck by a number of them, and that has the potential to profoundly affect your way of working and living. The ultimate goal as stated by the author was to pass on his learnings. This book is a brilliant snapshot of that.

Ray' book is a treasure cove of learnings on life and how to deal with important problems. Ray has a very peculiar way of approaching things of life and the book can come across as pretty human demeaning, but that's only if you overlook the entire scheme of things where his approach is that you must transparently embrace each failure and learn out of them. It also shows how you can do this at scale with most humans sharing their thoughts openly to form a self correcting collective thinking, which proved very effective in the context of Bridgewater Associates. Above this, there are many many learnings on how he got there and how to look at the world with a passion in the heart but a cold head so you can solve problems better. I found it to be an amazing book.

Principles has strong and idealistic ways to face various scenarios in life. The book basically gets you out of the box and helps you realise the power of your mind. These principles apply to absolutely anyone who wants to do great in whatever they want to be great at.

About the author

Ray Dalio is Founder, Co-CIO and Member of the Bridgewater Board, which, over the last forty years, has become the largest and best-performing hedge fund in the world. Dalio has appeared on the Time 100 list of the most influential people in the world as well as the Bloomberg Markets list of the 50 most influential people. He is also #1 New York Times bestselling author of Principles, Principles for Navigating Big Debt Crises, and Principles for Dealing with the Changing World Order. He lives with his family in Connecticut.