charting, diversification, Expected Value, falling knives, fear and greed, intrinsic value, investment checklists, momentum, portfolio allocation, position limits, stop losses, sunk costs, technical analysis, trading, value investing, value-trap
Continued from here.
I labelled as tricks some of the techniques I’m writing about here – which might have put off some readers. But surely you’ll try anything that might help combat the impact of fear & greed in your investing? Reconsidering, I’d now argue the five techniques I’ve already documented are actually essential tool-kit for any serious investor. Have another look, and I hope you’ll agree – to put it another way, it would be hard to argue your investing would actually improve if you omitted any of the following:
Learn To Love The Black Box: Document all your investments, and analyze & learn from your mistakes.
Checklist It: Develop checklist(s) for every stage of your investment process.
Valuation Orgy: Value your investments using as many different valuation techniques & metrics as possible.
Watch What They Do, Not What They Say: Focus on facts, figures & performance, not just the ‘story’.
Well, Are You The Right Size?: Set pre-defined position limits within your portfolio.
However, a majority of my remaining techniques do perhaps deserve to be called tricks. Which means they may, or may not, suit your investing style & personality. Trouble is, how will you ever know if they’d work for you, unless you give ’em a whirl..?! Or figure out how they’re best adapted to your particular circumstances? Right, let’s soldier on:
vi) Learn Some Bloody Voodoo