The Difference Between a Wise Man and a Fool First Time Investor Apply
Mar 01

Driving 100 MPH vs 70 MPH on Highway

Posted on March 1st, 2008 by Will Work for Cheesecake!!!

Do you really need to drive 100 MPH just to get to Memphis without endangering yourself? The answer would probably be no. Driving 70 MPH speed limit still get you there to Memphis without getting a ticket or killing yourself. The same can be apply with stock.

I signed up with a website called UpDown to test my skills and experiences. The things that I found were very surprising. I see a lot of short seller making a lot of fake money, but the number one on top is a long term investor by the name of LegMaker. I found that his investing style is so much like mine. He only beat the S&P by 4 percent a year, but why is he in the top spot. The reason is that do you really care if you beat the market as long you makes enough to provide you with extra income.

Do you really need to buy stock on Wednesday and then sell it on Thursday to make a quick profits? The investors by the name LegMaker and madhatter provide very thorough analysis. The double impact against short seller is more tax and more tax record headache. The commission would take much of your return away.

I found that the top earner that earn real money share very similar style of investing as I do. How surprising is that? Should I abandon Grahams and Fisher disciplines because other members is making more than I do in investing? No, I will never abandon the discipline and lessons my teachers have taught me. They have set the foundations in which I walk on.

The problem with short selling is that you’re risking everything. If you makes a mistake then you don’t have any Margin of Safety. The interesting things I find is that short sellers are usually young investor that are full of themselves. I can only sum up this statement. Short Sell if you want to gamble without diversification or margin of safety. Sure, I can not beat Short Seller in making more money but I am still in the game baby.

What Moods Are You in Right Now?

$@1 $@2 $@4 $@5 $@6 $@7 $@8 !@1 !@3 !@5 !@6 !@7 !@8 ^@1 ^@2 ^@3 ^@4