• As retail investors scouring the papers, magazines and internet for information we are often advised to sit tight and ride through the storms while sitting in a quality albeit small boat.  In other worlds be proactive in asset selection in order to prevent reactive actions which could jeopardize portfolio growth.

  • I find it interesting that, at the deep end of the investment pool, the institutional investors are reactive by nature and really quite jumpy.  Every time there is a high-pitched squeal amongst the background drone of the markets a big movement of money occurs - usually a contagion of dumping stocks.  Is this how wholesale investors make money?  I have occasionally wondered if I would have the fortitude to move 10 or 100 million dollars in and out of volatile equities while shaving off a several hundred basis points of profit.  Big movements + Small margins = Great profit. 
  • Two dichotomous approaches but there is one very big difference - They play with OPM while you and I play with our very own hard-earned cash.  Capital preservation must be a priority for us.  In order to replace ‘capital losses’ we generally have to earn income from our J-O-B.  Not only do we pay the price of time but we also lose out on compounding. 

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