The Art and Science of Investing.
by William J. Cara
There is no mystery to success in the markets. Investing is simply a business
of common sense, faith, courage, knowledge, patience and luck. As complex
as it might appear to you, the securities market is merely a case of "people
acting like people" -- with all their fears, enthusiasms, prejudices, stupidity
and wisdom. It is not, as I like to say, rocket science. Investing is a
journey and I intend to help you on your way. As we go down the road together,
it's well to keep in mind the basic guidelines I outline for you because
they will apply tomorrow just as much as today.
Investing is something anybody can do successfully if they remain
a student of the market, which is to say they are always open-minded,
always learning, always trying to get better. At the end of the day,
if you follow my time proven guidelines, set goals, use common sense
and exercise self discipline, you will succeed. You will measure your
success in terms of money but money, by itself, is never as important
as peace of mind, which is a synonym for happiness. Regardless of whether
you are conservative, aggressive, or speculative in personality/philosophy,
the first and simplest rule to investing is that if any investment
causes you, or your spouse, to worry, do not make it, or if you have
already done so and you worry about it, then sell it.
Wizdom for making money in the capital markets.
To construct a proper investment program, each independent investor
has to understand that investing is like a journey. You start from a
place and then head off along a certain path. If you know where you are
starting from and where you are going, you'll undoubtedly get there.
The place to start is with a realistic self-assessment of your own personality.
Are you basically (a) conservative, (b) enterprising or (c) speculative?
Think hard on this because there is never a need for investors to act out
of character. To succeed in the market, you need to just be yourself. If
you try something else, your journey will only get side-tracked.
After you have done this self-appraisal, your next decision is to choose
what line of approach you will take to investing in the capital markets.
The clear options are (a) fundamental (b) technical and (c) quantitative.
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About
the marketplace The market is the theatre of life where
the play is all about time and money. If investing represents
our journey and trading mirrors the paths we take, then the market
is the big show, the place all of us experience it. Read
more of this story.
Anything you read from the Trader Wizard will echo the insightful
words of Charles Dow. |
About
Financial Television Depending on the level of hype, financial
television can be classified like books: fiction and non-fiction.
Bloomberg TV (International) and ROBTV (Canada) are clearly in
the non-fiction category. They are head-and-shoulders superior
to their competitors. Read
more... For short-term investors, Bloomberg TV is excellent.
Not only is Bloomberg TV available to many investors on local
cable television, it is available to anybody in the world via
the Internet. |
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About
Personal Tax Avoidance All the economic powers of the world
are high rate income tax jurisdictions. Without lots of your
money they wouldn't have as much power. read
more... The United States is the only major country in the
world that taxes its citizens globally, wherever they reside,
in or out of the USA. Unlike citizens or resident aliens of most
other nations, a U.S. person can't escape by moving offshore. |
Trading bonds for capital gain In my view, sticking to the
common myth that bonds should be bought and then stored in a safety
deposit box is a foolish way to invest. Bonds are investment instruments
that must be traded like you would trade a stock. To most of you,
a bond is a secure, mostly stagnant investment that provides a
fixed annual income and can be redeemed at maturity for the same
amount of dollars used to purchase it when issued. Read
more about trading bonds. |
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The
gold futures market While it could be a good speculative
investment, gold is usually a poor investment for conservative
investors unless you are into writing puts or calls for additional
income. The gold futures market is that much more dangerous.
Gold futures contracts give the gold speculator the biggest bang
for the buck. More
about Gold futures. |
Fastest
moving groupsTo find the fastest moving groups, you must
first find the fastest moving industries with common themes as
to interest rates, commodity prices, or major economic factors.
After you zero in on an industry group, next look at the sub-group
stocks that Value Line or Standard & Poor's rates the highest
considering fundamental, quantitative and technical factors. More
about the fast movers. |
