Read? Real and Illusion Of Wealth In The Stock Market. It is selling that counts!
Long ago, Sir Isaac Newton gave us three laws of motion, which were the work of genius. But Sir Isaac's talents didn't extend to investing: He lost a bundle in the South Sea Bubble, explaining later, 'I can calculate the movement of the stars, but not the madness of men.' If he had not been traumatized by this loss, Sir Isaac might well have gone on to discover the Fourth Law of Motion: For investors as a whole, returns decrease as motion increases. ~Warren Buffett
Read? GameStop falls 42% more despite easing of broker restrictions, down more than 80% this week
Of course; there are real winners taking money off the hard earned savings from pitiful losers who will be sitting on unrealized paper losses for how long! Sigh!
There is always buyers and sellers in the market! Always keep this in our Mind! We won but someone lost it. We lost but someone won it!
"The market is not your mother. It consists of tough men and women who look for ways to take money away from you instead of pouring milk into your mouth." - Dr. Alexander Elder
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Sigh ... as I commented on 28 Jan ... Possibly the end of the beginning here.
ReplyDeleteMake no mistake, retails jumped in with both their eyes big big ... for $$$$$$$$. All those motherhood statements about "small guys against unscrupulous Wall Street" are just that, something like experiences are better than things. 😉
There'll be much more episodes of such foolishness as the secular bull continues, not only in stocks both longs & shorts, but also in various markets like properties, crypto, commodities, precious metals, art, collectibles, etc. Not saying you can't make money or shouldn't participate ... but know what is "normal" & what is "abnormal".
Re Buffett's "returns decrease as motion increases" --- doesn't really apply to himself though LOL. He practices plenty of motion like derivatives, profit taking, cutting loses, active investing, backroom deals, private equity, structured loans, etc.
Oh I forgot, he did say "for investors as a whole". Just buy S&P500 index & sit still for 30 years. 🤣
Spur,
DeleteThat's sacrilege!
There are bei kambings out there who "believe" Warren Buffett is a Buy-and-Hold investor...
To them, Warren Buffett is like "Buddha". Just sit still can oredi!
For many investors, "returns decrease as motion increases" holds true. For others, the opposite "Returns increase as motion increases" holds true. Renaissance Technologies's short-term, high motion Medallion fund surged 76% in 2020. Their other longer-term, slower motion funds tanked 22% and 33.58%.
ReplyDeleteMany different, even contradictory ways to make money from the markets. Certain Kungfu more suited to some people. It's a long arduous path to find out and learn the right Kungfu for the right person.
For most of us as retail; we may need more than one full market cycles of Bull-Bear-Bull-Bear or Bear-Bull-Bear-Bull to validate our kung fu.
DeleteAre you using fixed or wireless Internet?
ReplyDeleteYour service provider WIFI unstable. LOL. Time to power down and up your WIFI box
ReplyDelete