Maybe the biggest mistake investors make is buying shares of Apple or Zoom or whatever and then hoping the price goes right up.
It’s why you sometimes hear that the stock market is just a big casino.
Because some investors are just buying “prices” and then hoping to sell their prices at some higher price to someone else who’s then hoping for the exact same thing.
Which is gambling.
A more reliable way to make money investing is...
You’re at a blackjack table in Las Vegas.
The guy sitting next to you has a 10 of hearts and 7 of spades. Now, everyone knows when you have 17 that you stand, but this guy asks the dealer for a hit.
The dealer flips over a 4, and so the guy gets 21. Blackjack!
Nice hit, huh?
Well, the casino loves gamblers like him, because if someone always hits on 17 they’ll lose money. The probability of...
In 2016 I handed my boss a two-word resignation letter. “I’m resigning.”
That letter was maybe the best thing for my investment portfolio. When you don’t get a paycheck anymore it forces you into decisions.
Need cash for bills? Take some profits.
Want to buy a new stock? Gotta sell something.
Increase the size of an investment? Figure out what to trim.
Incidentally, this is what business owners do. What companies pay CEOs for. To decide how...
I started questioning my entire investment strategy. I had built a stock portfolio for growth, and was sure it was a horrible mistake.
I had already quit my day job to live off stocks, but was only getting $3,798 in dividends.
That’s the reason retirees love “income portfolios.” They invest their nest egg in things that generate enough income to fund their retirement. Typically stocks like AT&T or Coca-Cola or whatever that pays a fat dividend.
So,...
Every spring I watch a farmer plant his field.
He adds fuel to the tractor, buys fertilizer for the soil, and visits the supply store for seed. Nobody says, “What a fool! Wasting time and money on that stupid exercise.”
If you say anything at all you say, “Think about that bountiful harvest.”
The farmer is investing now. He gets nothing in return until later. But no one questions him because that’s how farming works. He invests now, harvests...
