July 27, 2017

Back to Work Ladies & Gents


It's been far too long since I made a post, I apologize to the 3 people that usually read them. Anyway, it's back to business putting my thoughts on digital paper about the market and certain equities that peak my interest. A couple quick important points that I think need to be discussed:

Timing the market/day trading is not for everyone. Actually, 99% of people should avoid trying to time the market. Why? Consider some facts: Almost 60% of stocks decrease in value during a given year. So you have less than a 50/50 chance of even picking a stock that makes you money. In addition, several studies that analyzed over 100,000+ brokerage accounts showed even more bad news: 90% of the accounts either lost money or made just a little bit of money.

That means almost everyone that tried to time the market got destroyed by robotic/idiotic investors that simply dollar cost averaged an index fund. In other words, people that have spent literally zero minutes studying the markets make far more for their retirement accounts than those that try to learn and put in the time.

This is one example where being simple, dumb and not taking the time to do your due diligence is way more profitable than the alternative. The latter strategy of working hard and studying companies in depth is what the media and the crowd want you to believe.

If you still doubt me, I don't blame you, simple solutions are generally associated with irresponsibility while being hard working and diligent is associated with being successful and primed for top performance. In saving for retirement, this is simply a losing strategy that will cost you tens of thousands of dollars during your lifetime, if not more.

Consider the worst investor of all time made a shitload of money for retirement despite buying in at every market top since the 1970s (article). How? He never sold or puked his shares when he thought he should or when the news media urged him to do so.

Anyway, sorry for being a Debby downer and basically rendering my blog useless because it was originally intended to help me and other people become day traders. But after years of being a trader and studying the market, I've concluded it's supremely irresponsible to encourage and help people train to be day traders.

On a more positive note, I will start posting again about my thoughts about market direction and certain stocks. But I want to stress that this is intended to be more of a trading journal for a small portion of my net worth. This blog is intended to be my trading journal and not a get rich quick inference.

I have a portion of my savings that is dedicated to day trading (gambling) while the rest (95%) is dedicated to dollar cost averaging. But for the 5% of gambling funds, I will discuss how I intend to make money above the market's returns, aka Alpha, knowing full well the odds are remarkably against me.

If you have any questions, concerns, just let me know in the comments, and I'll delete them :) Just kidding. But seriously, I thrive on having an open and brutally honest dialogue. It keeps me honest, it keeps me from lying to myself, and it helps me trade better and extract more money from billionaires and computers that control the markets.

Enjoy your evening because we have work to do tomorrow!