Comments on: The Right Lessons and The Wrong Lessons http://thefinancebuff.com/2009/09/the-right-lessons-and-the-wrong-lessons.html like a friend telling you about money ... Sat, 20 Mar 2010 00:52:38 -0500 http://wordpress.org/?v=2.8 hourly 1 By: Mark Wolfinger http://thefinancebuff.com/2009/09/the-right-lessons-and-the-wrong-lessons.html/comment-page-1#comment-2724 Mark Wolfinger Mon, 21 Sep 2009 18:50:33 +0000 http://thefinancebuff.com/2009/09/the-right-lessons-and-the-wrong-lessons.html#comment-2724 Ted, I have no clue what 'next time' will bring. But I do know what will work: A strategy that guarantees a floor on the value of my holdings (and I can choose the location of that floor), with limited upside. That's the collar strategy. I agree that I will never make profits like you do, but I won't incur the losses either. i have far less time, so must be concerned with preservation of assets. Cheers to you as well. Ted,

I have no clue what ‘next time’ will bring.

But I do know what will work: A strategy that guarantees a floor on the value of my holdings (and I can choose the location of that floor), with limited upside. That’s the collar strategy.

I agree that I will never make profits like you do, but I won’t incur the losses either. i have far less time, so must be concerned with preservation of assets.

Cheers to you as well.

]]> By: Ted Valentine http://thefinancebuff.com/2009/09/the-right-lessons-and-the-wrong-lessons.html/comment-page-1#comment-2723 Ted Valentine Mon, 21 Sep 2009 18:44:59 +0000 http://thefinancebuff.com/2009/09/the-right-lessons-and-the-wrong-lessons.html#comment-2723 Mark, Fair enough. I learned that last time I should not have stopped buying. I had a plan and failed to implement it last time because it was too risky based on bad advice. This time I had a more sensible plan that I understood and stuck to it. Its worked out better than I thought it would so far. Next time? Who knows. I'm going to stick to my plan. We shall see how it works. Since you asked, do you know what's going to work next time? Do you know what next time even is? Do I ever sell? At my age (mid-30s) I have a lot of time ahead of me, so I buy and hold. I plan not to sell, but to change my buying habits as I age (i.e, buy more bonds and fewer equities). Hopefully things will be very good and I will be forced to sell to reduce risk. Cheers. Mark,

Fair enough. I learned that last time I should not have stopped buying. I had a plan and failed to implement it last time because it was too risky based on bad advice. This time I had a more sensible plan that I understood and stuck to it. Its worked out better than I thought it would so far.

Next time? Who knows. I’m going to stick to my plan. We shall see how it works. Since you asked, do you know what’s going to work next time? Do you know what next time even is?

Do I ever sell? At my age (mid-30s) I have a lot of time ahead of me, so I buy and hold. I plan not to sell, but to change my buying habits as I age (i.e, buy more bonds and fewer equities). Hopefully things will be very good and I will be forced to sell to reduce risk.

Cheers.

]]> By: Ted Valentine http://thefinancebuff.com/2009/09/the-right-lessons-and-the-wrong-lessons.html/comment-page-1#comment-2722 Ted Valentine Mon, 21 Sep 2009 18:29:18 +0000 http://thefinancebuff.com/2009/09/the-right-lessons-and-the-wrong-lessons.html#comment-2722 Regarding the 200-day MA. There are several pseudopods (false feet) on that chart. It is easy to pick the right ones in hindsight. In the moment, one might not make the right decision. See the following dates where the market placed its foot on the other side of the 200-day MA for a moment: Nov 2007, Dec 2007, June 2008, June 2009, July 2009. I would like to see someone study the 200-day MA approach with a buy trigger based on the market being a certain % below the MA (say 30%) and a sell or hold trigger when the MA is a certain % above the MA (say 20%). Call it enhance buying low and selling high. Regarding the 200-day MA. There are several pseudopods (false feet) on that chart. It is easy to pick the right ones in hindsight. In the moment, one might not make the right decision. See the following dates where the market placed its foot on the other side of the 200-day MA for a moment: Nov 2007, Dec 2007, June 2008, June 2009, July 2009.

I would like to see someone study the 200-day MA approach with a buy trigger based on the market being a certain % below the MA (say 30%) and a sell or hold trigger when the MA is a certain % above the MA (say 20%). Call it enhance buying low and selling high.

]]> By: Mark Wolfinger http://thefinancebuff.com/2009/09/the-right-lessons-and-the-wrong-lessons.html/comment-page-1#comment-2721 Mark Wolfinger Mon, 21 Sep 2009 18:23:08 +0000 http://thefinancebuff.com/2009/09/the-right-lessons-and-the-wrong-lessons.html#comment-2721 Hi Ted, You 'learned' to keep buying? I argue that you did not learn anything useful. What you learned is that buying worked his time. And that it took a long time, but it worked in 2000. Legitimate questions, and I am not pulling your chain: What makes you think it will work next time? Do you ever sell? Regards Hi Ted,

You ‘learned’ to keep buying?

I argue that you did not learn anything useful. What you learned is that buying worked his time. And that it took a long time, but it worked in 2000.

Legitimate questions, and I am not pulling your chain:

What makes you think it will work next time?

Do you ever sell?

Regards

]]> By: Ted Valentine http://thefinancebuff.com/2009/09/the-right-lessons-and-the-wrong-lessons.html/comment-page-1#comment-2720 Ted Valentine Mon, 21 Sep 2009 18:18:54 +0000 http://thefinancebuff.com/2009/09/the-right-lessons-and-the-wrong-lessons.html#comment-2720 I learned to keep buying. In 2000 I froze up and stopped buying. Recovery took years. I kept buying this time and I'm about where I was this time last year. I learned to keep buying. In 2000 I froze up and stopped buying. Recovery took years. I kept buying this time and I’m about where I was this time last year.

]]> By: Mark Wolfinger http://thefinancebuff.com/2009/09/the-right-lessons-and-the-wrong-lessons.html/comment-page-1#comment-2695 Mark Wolfinger Wed, 16 Sep 2009 03:13:45 +0000 http://thefinancebuff.com/2009/09/the-right-lessons-and-the-wrong-lessons.html#comment-2695 "They are so simple they don't need any further explanation. " Statements such as those are not typically made by people like yourself. Anyone who doesn't understand any of your ideas ought to be encouraged to ask questions. That the path for that new investor to become an informed investor. If you tell him/her it's so simple that he should be ashamed of himself for failing to grasp your full meaning, then your are negating that investors desire to learn - in effect saying 'do it because I said so.' That's what's wrong now. The incompetent are leading the masses to ruin. Isn't that what ethical bloggers are trying to reverse? You are helping investors. Please don't discourage them from getting involved in the education process. “They are so simple they don’t need any further explanation. ”

Statements such as those are not typically made by people like yourself. Anyone who doesn’t understand any of your ideas ought to be encouraged to ask questions. That the path for that new investor to become an informed investor.

If you tell him/her it’s so simple that he should be ashamed of himself for failing to grasp your full meaning, then your are negating that investors desire to learn – in effect saying ‘do it because I said so.’

That’s what’s wrong now. The incompetent are leading the masses to ruin. Isn’t that what ethical bloggers are trying to reverse?

You are helping investors. Please don’t discourage them from getting involved in the education process.

]]> By: Mark Wolfinger http://thefinancebuff.com/2009/09/the-right-lessons-and-the-wrong-lessons.html/comment-page-1#comment-2694 Mark Wolfinger Wed, 16 Sep 2009 02:43:27 +0000 http://thefinancebuff.com/2009/09/the-right-lessons-and-the-wrong-lessons.html#comment-2694 "What lessons did you learn from the financial crisis?" Collars work. Collars protect your assets. “What lessons did you learn from the financial crisis?”

Collars work. Collars protect your assets.

]]> By: Retirement Savior http://thefinancebuff.com/2009/09/the-right-lessons-and-the-wrong-lessons.html/comment-page-1#comment-2690 Retirement Savior Tue, 15 Sep 2009 16:22:18 +0000 http://thefinancebuff.com/2009/09/the-right-lessons-and-the-wrong-lessons.html#comment-2690 Have you looked at the Meb Faber white paper that analyzes moving average timing? Long periods of outperformance and underperformance, but the risk adjusted returns are better in the long run. I like the article, it's good food for thought. Have you looked at the Meb Faber white paper that analyzes moving average timing? Long periods of outperformance and underperformance, but the risk adjusted returns are better in the long run.

I like the article, it’s good food for thought.

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