Quote:
Originally Posted by Flash68
Very sound analysis Greg. Whether it's real estate prices, or IPOs, or conventional lending, most asset bubble pops overcorrect and here we are.
Regarding your homebuilder shorting, I essentially did that with an ETF back in 08-09 with SRS - a "double-short" real estate index fund. It worked out quite well.
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Great playing - acting on what you saw and feel. Personally I NEVER SHORT. The downside is almost unlimited and the risk more than I want to take, regardless of my gut feeling. I've personally tried to invest in things I thought were going "well" rather than betting on something going bad. I can't tell you how many times I could have made some serious ROI shorting... but I just won't do it. I stick to what I "think" I know.
I bought Apple 5 years ago when I was at the mall - and noticed the only store in the entire mall that had people coming out the front door waiting to pay for the stuff they'd bought.... I came home and said - hmmmmmm.... That looks like a growing business to me.... Some call that the Peter Lynch version of investing. I tend to agree with that version of investment style. Something I can see - no analyst required. I wish I could repeat that "winner" on a more consistent basis. I have others we won't mention.
I'm not a "gambler" -- I don't day trade - I don't short - I don't buy anything with money I can't afford to lose. People say that - but they don't stick to it. I'm a stick to it kinda guy. I came from nothing... got lucky a couple of times - and have a total fear of returning to my roots... I DO NOT GAMBLE - that is different from "I never lose" because I lose all the time... I stick to the 5% rule - never more than 5% in any investment EVER... if the investment grows and is 8% - I take some off and invest in something else - I'm never a pig. I never "average down". I have a separate bucket of risk investment - think "Venture Capital"... that is a completely different investment play than the apartments I own. BALANCE is the way to not go broke. I've been broke - it's not nearly as much fun. I do take calculated risk... and sometimes they don't work out... but it never affects my lifestyle... nor causes me to have to bail on a winner to cover.
A quick story - neighbor comes over 3 years ago - says he just inherited 3/4's of a mil - and wants to know what stocks to buy. I asked him about his "other" investments - to which he says he has none. I asked him how much does it cost you to live a year? He tells me - I say where's that come from... He's retired - but he's NEGATIVE CASH FLOW... So I said - here's the way I'd go about this: Take 4 years of the negative flow - stick it in laddered CD's... SO THAT YOU DON'T HAVE TO SELL IN A DOWN MARKET.... and then pick 10 or so stocks - and buy into them over TIME... not all at once. So if you target Apple, for instance - and want to invest 10K in it - buy 2500 worth every quarter - up or down - stick to that... BUT DO NOT BUY ALL AT ONCE... I tell him.... There's a guy on Wall Street - when you buy -- he yells to his buddies "okay guys - he's in - take 'er down!" -- then when you sell -- He says - "he's out -- take 'er up!"
Needless to say he did what he wanted to do and his house is for sale.
Am I smart -- Have any of you ever met me?
The answer is ABSOLUTELY NOT... but, better lucky, than smart! is my favorite saying. And I want to live to be able to play another day. I don't do anything well - I do it all "average" - I realize this and I stick to it. Right now - I know lots of really broke smart people. They were greedy and margined their accounts and they leased their cars - and bought way more house than I... and have way nicer cars and toys. I hope they enjoyed them.
Brian Hobaugh SCCA National Tour June 2014
First Hemi 'Cuda Convertible Ever Built
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