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MoreFeasts said:
I tried to read a book on value investing in small caps last year.... it did make a lot of sense, but it didn't seem easy....I couldn't even finish the book , it seemed like about a thousand pages, if my memory serves me, at least 500, with endless statistics.
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Let me clarify. You have to educate yourself on the language of investing and more importantly, how markets work. The first is relatively easy for the motivated individual. The second requires a significant dedication and study, but the resources are out there either in some classic investment books are researching successful investor's "trading rules." It is my humble opinion that everything you need to know can be found in about 5 or 6 books, but you will have to read them about 5 times each. Even if you master this you still have to master the behavior side of employing any strategy. This is USUALLY the main problem for nearly everybody.

By easy I meant, once you learn the language, it is pretty easy to understand. Buying stocks with low price to book and low price to sales companies is relatively easy as you can screen for them or subscribe to a service.
 
MoreFeasts said:
Berkowitz, I am thinking he was the guy early on financials?, so he is probably catching up lately.

Was Heebner the guy who said he turned 30k in 10 million in 2 years, or something like that, and he had a system that worked in "up markets, down markets, sideways markets..."
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Ken Heebner, CGMFX. His RE fund was badass too. Look up his record. He bet on the fact that the Fed would turn things around, and was right. But he rode Ford all the way to the bottom and back. Both the correct calls with horrid timing.

Most people have never heard of Manu Daftary either. He's the guy who overtook Bill Miller's record of beating the S&P for a record # of years. Now another one star fund.
 
The Pearl said:
Let me clarify. You have to educate yourself on the language of investing and more importantly, how markets work. The first is relatively easy for the motivated individual. The second requires a significant dedication and study, but the resources are out there either in some classic investment books are researching successful investor's "trading rules." It is my humble opinion that everything you need to know can be found in about 5 or 6 books, but you will have to read them about 5 times each. Even if you master this you still have to master the behavior side of employing any strategy. This is USUALLY the main problem for nearly everybody.

By easy I meant, once you learn the language, it is pretty easy to understand. Buying stocks with low price to book and low price to sales companies is relatively easy as you can screen for them or subscribe to a service.
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The third leg is understanding individual markets of each company, which is nearly impossible without some sort of edge, and is exactly where geniuses like Buffett earn their keep. The fourth leg is having a semi-correct macro view. Good companies can overcome this somewhat but the best investors have a track record of picking every single one on the correct side.
 
I was waiting for Gabelli to hit eath. Might be a good time to look back into him and his 2x1 NAV fund outlandish value.
 
So Franklin, it sounds like your point is that even the industry superstars see their records of outperformance turn into records of underformance, which would suggest that there is no easy formula, and that even the best are doomed to dissappointments, so what chance do the rest of us have, which I agree with.

However, they are in the public eye, and managing huge portfolios.
If a little guy can do a little thing with a little bit of money that outperforms, there is a chance that they could stay under the radar, and maybe keep it going as the tactic might not be practical for someone running big amounts, depending on what the strategy is. Heck there might even be things that the Harvard grads don't know about.

Some guy had a book a few months ago claiming to do just this for huge returns.... focusing on small stocks with a new idea that the media just has not picked up on yet. One example, the film studio that did The Hunger Games, once he knew that the book was really popula with the kids.


Peter Lynch stuff ^^^^^^
night.
 
MoreFeasts said:
Thanks both of you... you've given me enough to mull over for a while.
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Here is what I would tell you and what I challenge everybody I come across that is interested in investing. Read Graham's "The Intelligent Investor." It has no equal. Than read Edwin Lefevre's "Reminiscenses of a Stock Operator." This is the single best book on how markets work. Than go to the Berkshire Hathaway site and read Buffett's shareholder letters. If you you can't put these down and devour them in record time and are totally enthralled than I would forget the entire endeavor and simply index as Franklin suggested.
 
The Pearl said:
Here is what I would tell you and what I challenge everybody I come across that is interested in investing. Read Graham's "The Intelligent Investor." It has no equal. Than read Edwin Lefevre's "Reminiscenses of a Stock Operator." This is the single best book on how markets work. Than go to the Berkshire Hathaway site and read Buffett's shareholder letters. If you you can't put these down and devour them in record time and are totally enthralled than I would forget the entire endeavor and simply index as Franklin suggested.
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Booooorrrrinnnggg!!
 
I never had any loose change worth investing.

seems to me that investing in other people's business makes you at a disadvantage start to finish. Doing stuff with other people's money might be a better way to go. That's what all stock companies are all about.

oh, well, that might just take too much effort. back to your stats and rumors, folks.
 
The Pearl said:
Even if you master this you still have to master the behavior side of employing any strategy. This is USUALLY the main problem for nearly everybody.
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Wouldn't any strategy by definition be a strategy to anticipate investor behavior?
Or are you talking about dealing with one's own emotions?

Babe, I agree, but I'd like to explore the investment strategy options, at least as an intellectual excercise.
It sounds like all of you think that most investors will underperform the market over time.
Why not just figure out what they are doing, and do the opposite?
 
MoreFeasts said:
If a little guy can do a little thing with a little bit of money that outperforms
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I don't see the point of earning a little bit of out performance with a little bit of money. Put in $100,000 and beat the market by 1%, you have an whopping $1000 extra. That's not worth the risk. Index it and spend 1/100th the time doing a little seasonal work for that extra grand. Even better, investing in yourself and raising your salary, and then insuring that salary, is the easiest way to beat the market by 1000%. Why go after 1-2% of a small figure when you could raise your annual salary by $10,00++ for as long as you wish?

I invest because I enjoy it. Well, used to. I liked spending my free time data mining or reading 300 page government reports on energy, etc. But I don't expect to ever beat the market in a way that pays me even $0.50/hour for my efforts.
 
franklin said:
I don't see the point of earning a little bit of out performance with a little bit of money. Put in $100,000 and beat the market by 1%, you have an whopping $1000 extra. That's not worth the risk. Index it and spend 1/100th the time doing a little seasonal work for that extra grand. Even better, investing in yourself and raising your salary, and then insuring that salary, is the easiest way to beat the market by 1000%. Why go after 1-2% of a small figure when you could raise your annual salary by $10,00++ for as long as you wish?

I invest because I enjoy it. Well, used to. I liked spending my free time data mining or reading 300 page government reports on energy, etc. But I don't expect to ever beat the market in a way that pays me even $0.50/hour for my efforts.
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well, I guess I mean more than 1% when I say a little, but I hear what you are saying.

The guy who invested in the movie company claimed to make a fortune from starting with much less than a hundred k . I forget exactly, but something like turning 30k into several million in a 3 or 4 years.
 
Here is another discussion on the same topics I have mentioned, but from 2007, reminiscent of Lynch.
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https://www.amazon.com/possible-100...HPH4L3W0S9JL/1?_encoding=UTF8&asin=0307336131
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This guy sounds a lot like the guy I heard a few months ago, so maybe that is a sign that the top is near.

I think there might be other tactics that could work also, although I also believe that the odds are stacked against the little guy most of the time, so I am not saying it would be easy.
 
MoreFeasts said:
Here is another discussion on the same topics I have mentioned, but from 2007, reminiscent of Lynch.
.
https://www.amazon.com/possible-100...HPH4L3W0S9JL/1?_encoding=UTF8&asin=0307336131
.
This guy sounds a lot like the guy I heard a few months ago, so maybe that is a sign that the top is near.

I think there might be other tactics that could work also, although I also believe that the odds are stacked against the little guy most of the time, so I am not saying it would be easy.
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I think you should follow his advice. I'm sure you too can double the return of the greatest stories of the past 50 years in one third the time. Apple, Microsoft, WalMart... who needs those measly 50 pounders when you can turn $4k into $1,000,000 overnight without any leverage and using only conservative fundamental analysis?

Do you see how facetious this is? Typical sales gimmick book from a guy with all the answers his naive crowd wants to hear.
 
I was not endorsing that particular book, and I am not saying that any formula will guarantee that sort of return, obviously. I gave the link because I thought some of the comments were interesting.
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However , I believe that some individual investors are beating the market in these times by enough of a margin to more than make it worth their time.
 
Not saying you were. The Pearl gave you the best advice you can get. Read those books; wait ten years.

Likely the only way you're going to learn is earning your wisdom, and pay your dues the hard way. If you want to beat the market then wait for the next bust, load up on Monster Energy, lock yourself in a room & live nothing but your market. Focus on the sector causing the bust and find the companies with little to no debt, enough cash to last a few years, and a product that's definitely staying around.

You only need 1 or 2 30 pounders to beat the market over 50 years.... if you want to become a millionaire overnight then good luck becoming the next market one in a bazillion. Entrepreneurs make money adding value; that's not an option for lowball stock investors.
 
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