As I've checked my portfolio of stocks, I realized stuffed that I have never realized on an up market. I have learned about myself and others. I have found an old system and learned an age old wisdom. "Only invest in what you know and understand at prices that makes sense."
Invest in what you know and understand. This reduces basically the investment population by more than 80%. Maybe it'll just leave about 5-20% of the businesses that one understands. It also means learning new things and not buying in things one does not fully understand.
Prices that makes sense means that within a reasonable time one expects that the prices one buys at will be rewarded with realistic profits and distribution of dividends. It also means not rushing into a rising market and being patient for it to be within one's price range. Moreso, it means having a margin of safety for any unforseen events one does not expect.
After about five years of experience, I have learned this much.
These fundamental philosophy would guide my investing strategy over the next years.
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2 comments:
i'm totally clueless and will definitely get lost with stocks! .... huhuh that is why i don't think i can get rich someday...
There are many ways of getting wealthy. One way is winning the lottery. Although the probability is very slim, it accidentally happens to some people.
For the more adventurous type, there's also real estate investing, through starting an entrepreneurial endeavor. Another way is by way of invention (like Mr. Thomas Alba Edison), or writing (think J.K. Rowling and Harry Potter). With the new advent of techonology there had been additional ways of avenue for wealth creation. The idea of Facebook created the youngest billionaire such as the idea of software made Bill Gates wealthy.
The possibilities are endless.
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