I was afraid that question might come up. I don't know what the future holds any more than anyone else, and to be honest, I'm glad about that.

Of course, I do. But I also tell them that I am well versed in intelligent and scientifically proven methods that can be used to overcome this uncertainty.

I only invest in assets that are based on an economic value-creation process. And a solid diversification of investments is central to long-term stock market success. An average equity portfolio contains around 50 stocks – broken down by sector, geographical region and other criteria. This results in an average return of 7% to 9% per year over the long term – depending on the observation period. This is confirmed by historical performance analyses, such as those carried out by Bank Pictet since 1926 or the three financial market historians Elroy Dimson, Paul Marsh and Mike Staunton over a period of 122 years.

Your example shows very well why good diversification is essential. Precisely because we don't know which stocks will be the best next year, it's vital that we diversify the risks. If we knew that Novo Nordisk and Eli Lilly would once again overshadow all other pharmaceutical stocks next year, then we would naturally have to concentrate entirely on these two stocks and leave Roche, Novartis, Pfizer or Merck aside.

No. There are also exclusion criteria. About ten years ago, we decided to stop holding airline, automotive and banking stocks. We had to recognise that these sectors would not be able to keep up with the market average in the long term. These are sectors in which competition prevents shareholder value from being created in the long term.

In the next crisis, banks will once again be collectively on the brink of collapse. That's why we generally avoid shares in this sector. The banks have far too little equity. I am also suspicious of the whole bonus system in the big banks.

Of course, UBS now has an excellent opportunity to acquire a lot of Credit Suisse business. But Cevian is no reason for us to get on board. Activist investors are speculators, we do not speculate but invest for the long term. UBS will still have to prove that the CS takeover was a big hit.

Every diversified portfolio always contains stocks that do not perform well. But take the example of Martin Ebner …

… he was extremely successful in the 1990s with his strategy of focusing on very few stocks. I met him three or four times in Zurich. He laughed at my consistent diversification approach. He told me: "We know exactly which stocks to buy. We buy three or four stocks – Roche was one, ABB another – that we know so much about that we always have a head start on the market and are better.

Exactly. In 2001, the dotcom bubble burst. In September of the same year, there was a terrorist attack on the World Trade Centre in New York. The markets tanked by more than 40%. Ebner collapsed completely – for two reasons: Because he had not diversified his investments and because he used too much outside capital. The Ebner example proves that, at some point, every guru becomes a victim of hubris.

This is the key point why I like to say that I am a science-based asset manager. I wrote my dissertation on the portfolio theory of Harry Markowitz, who incidentally only recently passed away at the age of 95. Today, many people laugh at this theory, which basically says nothing other than that the markets are incredibly fast and efficient at processing new information and pricing it into the prices of shares, bonds and all other exchange-traded securities. Because this happens so quickly, even professionals are always too late.

Yes, we have to live with that. But the Ebners and all the hedge fund managers in the world, who all enjoy more or less guru status, get up in the morning and think they know more than the others. Markowitz taught me humility when I was young. I saw that every bank tried to excel with its best analysts, products and forecasters. I learnt to expose this as complete hubris and now know that this is the disease of all supposed gurus.

You are right. Warren Buffett really is a legend. But Buffett is still not a role model for me – even less so today than in the past. Firstly, he invests almost exclusively in American stocks. Secondly, he has a significant weighting in shares in insurance companies and banks. Thirdly, his Apple stake represents around half of his total investment assets. This completely contradicts my principle. Apple is not an invulnerable company either.

Making such decisions is much more complex than avoiding an entire industry. General Electric was an icon on the American stock market until the 1990s. Everyone had to have this stock – including us. But then came the gradual decline. It was tough to part with the shares because the lower a share falls, the greater the potential for a price recovery. But these can be deceptive moments because the risk is exceptionally high. Restructuring does not always work as well as it did in the case of ABB a good 20 years ago. Anyone who bets on a share that has lost 80 percent is basically behaving like a casino player betting on red or black at the roulette table.