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Lessons On Investing: From The Experts

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1) John (Jack) Bogle- master of mutual fund investing. Introduced the first index fund . He says:

“Time is your friend; impulse is your enemy.”
“When reward is at its pinnacle, risk is near at hand.”

2) Warren Buffet- master of stocks and business investing (by buying companies through Berkshire Hathaway). He says:

“Shares are not mere pieces of paper. They represent part ownership of a business. So, when contemplating an investment, think like a prospective owner.”
“Look at market fluctuations as your friend rather than your enemy. Profit from folly rather than participate in it.”

3) David Dreman is a contrarian investor. Great example of what it means to go against status quo. He says:

“Psychology is probably the most important factor in the market – and one that is least understood.”
“If you have good stocks and you really know them, you’ll make money if you’re patient over three years or more.”

4) Philip A Fisher, most influential investor of all time. Advised chief executives and had a career that spanned 70 years. Master of stock investing. He says:

“I don’t want a lot of good investments; I want a few outstanding ones.”

“I sought out Phil Fisher after reading his “Common Stocks and Uncommon Profits”. When I met him, I was impressed by the man and his ideas.
A thorough understanding of a business, by using Phil’s techniques … enables one to make intelligent investment commitments.”
 (Warren Buffett)

5) Benjamin Graham amongst many other things was the master of value investing. He was basically an investing analyst which made him an investing
manager and financial educator. He says:

“Even the intelligent investor is likely to need considerable willpower to keep from following the crowd.”
“To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks.”

6) Bill Gross master of bond investing, was called “king of bonds.” He is the world’s leading bond fund manager. He says:

“Finding the best person or the best organization to invest your money is one of the most important financial decisions you’ll ever make.”
“Do you really like a particular stock? Put 10% or so of your portfolio on it. Make the idea count … Good [investment] ideas should not be diversified away into meaningless oblivion.”

7) Carl Ichan master of stock investing. A catchphrase by Wall Street being “The Ichan Lift” meant that stocks rose when Ichan bought them from companies he believed was run poorly.
He says:

“I make money. Nothing wrong with that. That’s what I want to do. That’s what I’m here to do. That’s what I enjoy.”
“When most investors, including the pros, all agree on something, they’re usually wrong.”

8) Jesse L Livermore, a self-made stock trader. Famous for making and losing several multimillion dollar fortunes. He says:

“The average man doesn’t wish to be told that it is a bull or a bear market. What he desires is to be told specifically which particular stock to buy or sell. He wants to get something for nothing. He does not wish to work. He doesn’t even wish to have to think.”

“When it comes to selling stocks, it is plain that nobody can sell unless somebody wants those stocks. If you operate on a large scale, you will have to bear that in mind all the time.”

9) Peter Lynch, master of stock investing. Nicknamed “chameleon” for adapting to whatever investing style worked at the time. He says:

“Investing without research is like playing stud poker and never looking at the cards.”
“If you spend more than 13 minutes analyzing economic and market forecasts, you’ve wasted 10 minutes.”

10) Bill Miller, master of value investing. He was a portfolio manager at a company whose funds grew from $750 million in 1950 to $20 billion in 2006 under
his management. He had an interestingly different view of value investing. He says:

“I often remind our analysts that 100% of the information you have about a company represents the past, and 100% of a stock’s valuation depends on the future.”

“What we try to do is take advantage of errors others make, usually because they are too short-term oriented, or they react to dramatic events, or they overestimate the impact of events, and so on.”

11) John Neff was a portfolio manager who preferred to buy on bad news after a stock had taken a substantial plunge and to take “indirect paths” to buying in to popular industries.
He was considered a professional’s professional because many fund managers entrusted their money to him with the belief that it would be in safe hands. He says:

“It’s not always easy to do what’s not popular, but that’s where you make your money.
Buy stocks that look bad to less careful investors and hang on until their real value is recognized.”

“Successful stocks don’t tell you when to sell. When you feel like bragging, it’s probably time to sell.”

12)  William J O’Niel was a top performing stock broker and inventor of the growth stock investing strategy. In short  he seeks out only those growth
stocks that have the greatest potential for swift price rises from the moment they are purchased. He says:

“Since the market tends to go in the opposite direction of what the majority of people think, I would say 95% of all these people you hear on TV shows are giving you their personal opinion. And personal opinions are almost always worthless … facts and markets are far more reliable.”

“The whole secret to winning and losing in the stock market is to lose the least amount possible when you’re not right.”

13) Julian Robertson, said to have the best hedge fund throughout the 80s and 90s. His hedge fund Tiger Management became the world’s largest fund. He was a macro trader, and often rode worldwide trends. He says:

Our mandate is to find the 200 best companies in the world and invest in them, and find the 200 worst companies in the world and go short on them. If the 200 best don’t do better than the 200 worst, you should probably be in another business.”

“Hear a [stock] story, analyze and buy aggressively if it feels right.”

14) Thomas Rowe Price Jr was called, “the father of growth investing,” who  pioneered the methodology of growth investing by focusing on well-managed companies in fertile fields whose earnings and dividends were expected to grow faster than inflation and the overall economy. He says:

“No one can see ahead three years, let alone five or ten. Competition, new inventions – all kinds of things – can change the situation in twelve months.”
“It is better to be early than too late in recognizing the passing of one era, the waning of old investment favorites and the advent of a new era affording new opportunities for the investor.”

15) James D Slater master of stock investing. He invented the term  price-earnings to earnings-growth ratio to allow people to look beyond just the price earnings ratio. He says:

Most leading brokers cannot spare the time and money to research smaller stocks. You are therefore more likely to find a bargain in this relatively under-exploited area of the stock market.”

“You get out of an investment what you put into it, so the first decision you have to make is how much time you are prepared to devote to the initial task of acquiring a basic knowledge of investment.

16) George Soros was a master at translating broad-brush economic trends into highly leveraged, killer plays in bonds and currencies. As an investor, Soros was a short-term speculator, making huge bets on the directions of financial markets. He says:
It’s not whether you’re right or wrong that’s important, but how much money you make when you’re right and how much you lose when you’re wrong.”
“Playing by the rules, one does the best he can, irrespective of the social consequences. Whereas in making the rules, people ought to be concerned with the social consequences and not with their personal interests.”
17) Michael Steinhardt was a stock trader whose focus was on emphasizing macro asset allocation type moves from which he harvested his gains.
He says:
“I do an enormous amount of trading, not necessarily just for profit, but also because it opens up other opportunities. I get a chance to smell a lot of things. Trading is a catalyst.”
“I always used fundamentals. But the fact is that often, the time frame of my investments was short-term.”
18) John Templeton a great contrarian investor who believed that the best bargains were in stocks that were completely neglected – those that other investors were not even studying. He says:
“Rejecting technical analysis as a method for investing, Templeton says, “You must be a fundamentalist to be really successful in the market.”
“If you want to have a better performance than the crowd, you must do things differently from the crowd.”
19) Ralph Wanger well known for long term shareholding. He was quoted saying, “Be a long-term holder of smaller companies with financial strength, entrepreneurial managers and understandable businesses that will benefit from a macroeconomic trend. He says:
“An attractive investment area must have favorable characteristics that should last five years or longer.”“Chances are, things have changed enough so that whatever made you a success thirty years ago doesn’t work anymore.  I think that by concentrating on smaller companies, you improve your chances of catching the next wave.”
In Conclusion
If you read each of the quotes carefully you’ll notice three core things about investing:
a) Patience is inevitable. If you don’t like waiting for great returns and outstanding profits, you should be in another business.
b) The market cannot be predicted.
c) Knowledge of your investment is more important than any investment you make.
The common thing with all the people above is vast the knowledge they had with whatever they chose to invest in. Robert Kiyosaki says that it’s the investor that’s risky not the investment because without research you’re going in blind, no matter how good the investment
looks or sounds.
The purpose of the list above is to motivate people to make an effort to invest by first opening the eyes to the world of investing.
I sure learned a great deal from all of them. The brief introduction about each of them was intentional because the point was
to allow you to get an idea of who made the quote. I know some have slightly longer ones (introduction) than others but that’s because two or
more investors would have had the same investing style, so the idea would be to differentiate the methodology, not to make one
appear more important than the other. We should learn about the different types of investments and decide which one we’ll focus on
more than the others.
Even if you’re an employee or self employed, investing will help a lot with creating a budget surplus and a monthly surplus (increase in monthly income).
Lessons from the Bible
1) Diversify
Ecclesiastes 11:2
Give a portion to seven, yes, even [divide it] to eight, for you know not what evil may come upon the earth.Invest in stocks, commodities, real estate or businesses. Don’t keep all your eggs in one basket! Your portion
is your investment capital.

2) Know your investment
Proverbs 19:2
Desire without knowledge is not good, and to be overhasty is to sin and miss the mark.
It’s actually simple, avoid investments you don’t understand.

3) Carefully watch your investments
Proverbs 27:23-24
Be diligent to know the state of your flocks, and look well to your herds;
 For riches are not forever; does a crown endure to all generations?

This is not about tracking your investments, it’s about knowing the state of your investment. We are merely stewards of what is the Lord’s anyways. The key thing to understand is cash flow. Where does the money go once you invest it?
How can you grow an investment when you don’t know where it’s going?

In the same way the world needs more filmmakers who are also Christians,  the world needs more investors who are also Christians.

Here is my personal quote: Investing, more than anything else, is a character and knowledge subject.

 

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