From Tom Dyson, founder, Palm Beach Research Group: Position sizing is the most important lesson in all of investing.

It’s how hedge fund manager George Soros delivered an average annual return of 30% per year for nearly 40 years.

Mutual fund pioneer John Templeton posted 14% average annual returns for 50 years using position sizing.

Julian Robertson posted the best hedge fund performance during the ’80s and ’90s—with 32% annual returns—by applying position sizes to his portfolio.

Position sizing is about not overinvesting. You’ve been told your whole life not to put all your eggs in one basket. This also applies to investing—yet it is widely ignored.

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Soros didn’t make 30% per year for four decades by being right every time.

His “win rate” was around 60%. Same with Robertson.

Your stock-picking ability may be as good as (or even better than) Robertson or Soros.

But if you’re overinvested, one bad investment can crater your entire portfolio’s performance.

In 26 words, Soros succinctly describes position sizing in what may be the most important advice on investing ever:

It’s not whether you’re right or wrong that’s important, but how much money you make when you’re right and how much you lose when you’re wrong.

This lesson is the pillar of investing success. Practicing it will put you ahead of 99% of investors. And it will allow you to sleep well at night… even when you’re making big speculations like we do in our elite new service, Palm Beach Confidential.