1. " It is always a mistake to need markets to perform in a certain way in the short-run."
+1. Anyone in that position has made a strategic (or tactical) mistake.
2. I've noticed lots of TV ads for new brokerage interfaces -- for "beginning investors" -- that emphasize "easy to use" as a feature. You've reinforced my half-formed thought:
. . . "Easy to use" isn't a feature -- it's a bug!
Thanks for this. I recently installed Schwab's StreetSmart Edge. I then felt like i was in Vegas, with the security prices flashing changes up and down. I thought, this is not good. It's too enticing, so I went back to making buys and sells on the regular website. Nice to have good behavior and discipline reinforced. Thanks, again.
I was recently listening to a interview with Edward Thorp (Friend of Buffett) he highlighted that the index funds often performed equally to the average of successful active traders, but due to the cost of trading and fees they ended up losing out by several percent.
All these brokerage apps make money through every trade so it makes sense for them to maximise use, rather than actually help the customer make money
You know I think I misunderstood your comment. Do you mean that the indexes do as well as active traders but the index loses out because of their fees, churn, and taxes? or that the active traders do worse? Sorry...I'm not sure I thought you meant the traders lose to the indexes.
I think you got it right, what I meant was, that many active traders end up with similar returns to those that stick to index funds. However the active traders end up losing out after considering trading fees, which can mount up to several percent on a yearly basis. This is what the person was saying in the interview
thanks. I've been reading The Intelligent Investor, again; Chapter 4 right now. Passive investing and seeing his comments on various allocation percentages. Learning a lot. I read this once years ago and didn't understand it but I'm beginning to understand things.
I got off the StreetSmart app on Schwab--like a slot machine. :)
After reading Ur note, I gave the following a thought.
I’ve been at this public/private investing since ‘87 &, have passed the baton over to my Son. Early on, I defined risk as “if you can’t sleep well” it was too much risk. The other component was whatever was committed to a private business opportunity or, public market investment “ could the family nonetheless survive at least another year if the transaction blew up into a complete loss.
So many books & intellectual mathematical models never came close to these two basic simple rules of investing & defining risk.
I used to deal with a fund which only accepted hard copies to deal with any cashing out, these funds ended up being some of the best performers and funds that I held the longest due to the extra effort I would have to go through to cashout.
Makes a lot of sense to run your investments as a business, something I should focus more on.
Yes, that's what I thought. Thanks so much. Appreciate good thoughts and direction.
:) Best wishes
1. " It is always a mistake to need markets to perform in a certain way in the short-run."
+1. Anyone in that position has made a strategic (or tactical) mistake.
2. I've noticed lots of TV ads for new brokerage interfaces -- for "beginning investors" -- that emphasize "easy to use" as a feature. You've reinforced my half-formed thought:
. . . "Easy to use" isn't a feature -- it's a bug!
. charles
Thanks for this. I recently installed Schwab's StreetSmart Edge. I then felt like i was in Vegas, with the security prices flashing changes up and down. I thought, this is not good. It's too enticing, so I went back to making buys and sells on the regular website. Nice to have good behavior and discipline reinforced. Thanks, again.
I was recently listening to a interview with Edward Thorp (Friend of Buffett) he highlighted that the index funds often performed equally to the average of successful active traders, but due to the cost of trading and fees they ended up losing out by several percent.
All these brokerage apps make money through every trade so it makes sense for them to maximise use, rather than actually help the customer make money
You know I think I misunderstood your comment. Do you mean that the indexes do as well as active traders but the index loses out because of their fees, churn, and taxes? or that the active traders do worse? Sorry...I'm not sure I thought you meant the traders lose to the indexes.
I think you got it right, what I meant was, that many active traders end up with similar returns to those that stick to index funds. However the active traders end up losing out after considering trading fees, which can mount up to several percent on a yearly basis. This is what the person was saying in the interview
thanks. I've been reading The Intelligent Investor, again; Chapter 4 right now. Passive investing and seeing his comments on various allocation percentages. Learning a lot. I read this once years ago and didn't understand it but I'm beginning to understand things.
I got off the StreetSmart app on Schwab--like a slot machine. :)
After reading Ur note, I gave the following a thought.
I’ve been at this public/private investing since ‘87 &, have passed the baton over to my Son. Early on, I defined risk as “if you can’t sleep well” it was too much risk. The other component was whatever was committed to a private business opportunity or, public market investment “ could the family nonetheless survive at least another year if the transaction blew up into a complete loss.
So many books & intellectual mathematical models never came close to these two basic simple rules of investing & defining risk.
I used to deal with a fund which only accepted hard copies to deal with any cashing out, these funds ended up being some of the best performers and funds that I held the longest due to the extra effort I would have to go through to cashout.
Makes a lot of sense to run your investments as a business, something I should focus more on.
Interesting! I do the same regarding not having brokerage apps on my phone.