Well, everyone knows that buffet says be greedy when the market is fearful... Just another way of saying buy low, sell high. A lot of novice investors actually just get this tiny piece of info and use it as their investment philosophy as if it's the only strategy.
IT's really misleading when people try to simplify things very much.
Just take the example of being greedy when the market is fearful... so do you buy that for all sorts of stocks?
You shouldnt. You have to realize the buffet does his homework. He looks at the internal capabilities, cash potential, assets of the company that can't be known to other investors. He looks at trends of the other complementary business that might affect the demand of the products/services of the company he is trying to buy during "bad" times. He also looks at the ability of the managers to get things done inside the company... so many things you need to consider that "simply" saying "BE Greedy when the market is fearful" could lose people A LOT of money.
Well, everyone knows that buffet says be greedy when the market is fearful... Just another way of saying buy low, sell high. A lot of novice investors actually just get this tiny piece of info and use it as their investment philosophy as if it's the only strategy.
IT's really misleading when people try to simplify things very much.
Just take the example of being greedy when the market is fearful... so do you buy that for all sorts of stocks?
You shouldnt. You have to realize the buffet does his homework. He looks at the internal capabilities, cash potential, assets of the company that can't be known to other investors. He looks at trends of the other complementary business that might affect the demand of the products/services of the company he is trying to buy during "bad" times. He also looks at the ability of the managers to get things done inside the company... so many things you need to consider that "simply" saying "BE Greedy when the market is fearful" could lose people A LOT of money.
Yes, agree. Its particularly pathetic when governments come out with this nonsense to serve their own interests. Like increasing the home owners grant in Australia to induce more debt creation, and at the same time cutting rates, as if 'lower rates = good investment'. And the media, well they just love it. Inflation will be the next bugbear. Buy gold or gold stocks!
I am staying out of the market these days. I lost too much already. I think its' better to have invested in a small business I can control. This way, the only problem if the business fails is that I probably screwed up. The problem with investing in stocks is that you have to rely on the "often" corrupt and dishonest managers or ceos of companies who usually have poor disclosure about the true state of their companies. Just lost faith in the market.
I am staying out of the market these days. I lost too much already. I think its' better to have invested in a small business I can control. This way, the only problem if the business fails is that I probably screwed up. The problem with investing in stocks is that you have to rely on the "often" corrupt and dishonest managers or ceos of companies who usually have poor disclosure about the true state of their companies. Just lost faith in the market.
That is not a bad idea if you are investing in a recession-proof business, or a low-capital business that will not drain you in these soft years. You should have some savings though to get through. You will be well set when the market recovers in a few years.
