The truth is, almost everything about superior investing is a two-edged sword:
-If you invest, you will lose money if the market declines.
-If you don’t invest, you will miss out on gains if the market rises.
-Market timing will add value if it can be done right.
-Buy-and-hold will produce better results if timing can’t be done right.
-Aggressiveness will help when the market rises but hurt when it falls.
-Defensiveness will help when the market falls but hurt when it rises.
-If you concentrate your portfolio, your mistakes will kill you.
-If you diversify, the payoff from your successes will be diminished.
-If you employ leverage, your successes will be magnified.
-If you employ leverage, your mistakes will be magnified.
John D. Rockefeller is said to have been the richest person in history, even if he lived today. He left us with some wise quotes, check them out:
I do not think that there is any other quality so essential to success of any kind as the quality of perseverance. It overcomes almost everything, even nature.
If your only goal is to become rich, you will never achieve it.
It is wrong to assume that men of immense wealth are always happy.
The most important thing for a young man is to establish a credit… a reputation, character.
I know of nothing more despicable and pathetic than a man who devotes all the hours of the waking day to the making of money for money’s sake.
Don’t be afraid to give up the good to go for the great.
Don’t blame the marketing department. The buck stops with the chief executive.
Good leadership consists of showing average people how to do the work of superior people.
I always tried to turn every disaster into an opportunity.
I believe in the dignity of labor, whether with head or hand; that the world owes no man a living but that it owes every man an opportunity to make a living.
These are some very wise quotes from the richest man in history.
“Really good traders are also capable of changing their mind in an instant. They can be dogmatic in their opinion and then immediately change it. If you can’t do that, you will get caught in a position and be wiped out.” -Steve Clark
The greatest traders have a huge conviction about their edge and trading method after confirming its ability to create long term profits. It is hard for many new traders to grasp that great traders are able to change their opinion about a trade in a manner of minutes for many reasons. Unlike other professions that are paid to be right,it costs traders if they will not admit they are wrong quickly. In a mechanical system stops must be taken when they are hit, in a discretionary system price movement is the dictator and the trader must be the slave. If you are short a stock and resistance is broken through and closed above with power, then you are wrong, you are now short a break out. If you buy support and the stock plunges far below where you expected the bounce then the stock has broken the range and may be in a down trend. Continue reading »