10 tricks of the trade that will assure you of being successful like me over a long period of time, and if not highly successful, you are guaranteed not to get hammered over time, like so many. Remember, the fund bums can mask all their failures with new money coming into the fund from advertising. So all of their bombshell bonehead moves get masked, and even here, these knucklehead business majors cannot outperform the simple etfs.:
1. buy when skepticism is rampant. In gold and silver, all you hear on podcasts and kitco and from the mainstream financial media is: "well now, yes I agree, that there is no inflation...blah blah"
Please listen to the John Williams interview I just posted. It tears their argument to shreds. He says 9% and we might well go much higher. He is far more capable and knowledgeable than they are. Merely changing categories and fixing figures and relying on fake categories these flunkies do this century, does not hide the truth.
2. Buy when fundamentals are intact and getting stronger. Here is where you gotta know what you are about, and what you are doing. Experience counts a lot here, and so does discipline.
3. Do not EVER CHASE HOT STOCKS OR ETFS OR SECTORS....The odds are high, that you are getting in late, i.e. over 50%, and there are reasons for this....If you got in early, and there is a major pullback, you might be able to weather it out, but if you get in at the 2/3rd point, before the blow off top, there will be a major pullback, and this will wash you out.....NEVER CHASE STOCKS THAT ARE UP SUBSTANTIALLY...
4. Never fall in love with a stock or a company manager. You gotta be a fast seller so very often.
5. Never let (or rarely let) tax considerations affect your ownership position in a stock. The caveat is if you are in the last month of the year perhaps, but only perhaps.....if the stock is up dramatically, sell the whole thing, and if bad news comes out that sucks, dump the sucker so fast, even if you love it. Hit the sell button and beat others out of the stock. Following these two rules will change your entire life and they are so hard to follow. Force yourself to follow them. Write them on your computer screen.
6. Do not ignore macro themes or events or under or over valuations. So many hyper focus on just their own stock or stocks, believing the wall street main stream media idea that you are in it for the long haul, that is what investing is all about. LOL>...LIES LIES LIES GET OUT. The hyper focus people are generally supremely confident or stubbornly confident or both. It is a big world, they should realize. Have an open mind. Peter Lynch, the greatest fund manager who ever lived, who built the Magellin fund into the greatest fund in the world for over 20 years, used to sell 1/3 of his stocks every six months, and put others in their place as he saw fit..... He would sell his darlings all the time, and he was a genius. If he does it, admitting things have changed or that he was wrong, why shouldn't you? A mind that does not stay open is an intellectual and financial liability.
7. Do not be afraid to load up on a designated event. If you follow smaller companies closely, you can learn a ton from careful study or hyper study, perhaps a tip in a conference call, which are often loaded with inside information...........Play these events if you feel strongly but you must get in early. If you play it just two weeks before the actual event (where you might in fact want to sell before the event), you are probably too late. The guys who played it 5 weeks before are way ahead of you, so you might be dead meat.
8. Do not get hyper worried about all the negatives. If you find you are worried about the negative what ifs, this means you probably should not be in equities for that time period. You will find you are focusing on the negatives with all your companies, and that is a sure sign you should be in cash for a month or two to regain your sense of risk and perception.
9. You must be willing to sell overvalued markets and stocks. The fund bums tend to always stay largely invested, no matter if the pigs are bloated. Hey, in the final analysis they are all just letters and stock symbols; they are not your friends. Sell the pigs, let them tumble, go on vacation. Merely because you know more than most or almost anybody about a stock, does not mean you can play it or time it better than somebody else, and sometimes this is a detriment. You lose perspective.
10. Listen to yourself. As a lawyer, when young I would refer my big cases out to the large firms, thinking they were too big for me, and get back a percentage. In just a few years I learned to try to keep them, and in just a few years more, the big firms were sending me their big cases to try, or sometimes they would try to hook me in as co counsel in one of their big cases......So if you have been doing this long enough, and lost a lot of money as we all do, but are still at it, you will learn the fund bums on places like Seeking Alpha are just talking their own book, spouting out this or that, but the bottom line is many get crushed in the market, so it is better, so often, to follow your themes....just own smallish parts of companies, to see how you do over time, to see if your hunch is true.
All of these rules we all sort of know, but I have paid a steep tuition for all of them. fwiw. One thing is very clear to me, naturally, is that if you try to follow them, and do follow them, you may well wildly outperform the funds. I write them because I see regular people making the same mistakes over and over. I realize nobody has a crystal ball as well.
Bonus tip 11: try not to mistake being lucky for being long term good. We all get lucky once and a while, best to recognize it.
