I’m sure you’ve heard this before, but unless you have a lot of time to research companies, you’re better off in a traditional fund or exchange traded fund.

A vast majority of the pros who spend their days doing analysis fail to beat the “market”. And the fund managers that everyone hails as being above the rest still only achieve low double-digit returns.

I feel bad for Hermann who thinks that with enough work he can expect 100% returns. That just isn’t going to happen.

But good luck with whatever path you choose!

You’ve presented a few curiousities, but not a philosophy. You need to learn the difference between technical and fundamental analysis, and between trading and investing. I’m only holding JNJ, a defensive issue, and have earned quite comfortably in recent weeks. I’ve also learned to favor fundamentally exceptional stocks, to wait for the right time to buy, and to accept very small gains, rather than chasing a big hit. Even AAPL is beyond my risk profile. I make about three trades per year, and that’s probably too many! I earn $11/day on CD’s… guaranteed. If I’m switching money from there into a market with risk, there better be a good reason. Vegas is not a good reason. There’s a saying in trading: Bulls can make money, and bears can make money, but pigs get slaughtered. Know what you’re doing, or stop doing it.

I’ve been playing the stock game for over 15 years… There is truth in the above statement. You never know how far a stock will drop (or rise!). Do you really want to be holding Nortel… or Cisco… or Verizon. Or how about Enron, Worldcom, etc… Certaintly all those companies have (or had) what seems like valid business models. When a stock starts to drop, get out! You can always get back in if it starts to turn around. Now, using an example of Nortel… it may recover – eventually. But how long do you want to hold a dead stock? What is the oppurtunity cost of this?

Up, down, who cares? If it’s up, I buy less; if it’s down, I buy more.

I firmly believe that the buying decision is the more important of the two. Too many purchases by beginner investors are based on impulse, fleet of the moment.

You also made a good point about staying in the market but a better question is why people are buying and selling so often in the first place? What’s driving them not to stay in the market?

Playing devil’s advocate, yes, I’d like to also see the statistics on being out the 5 / 10 / etc WORST days as well. Bringing up those favourable statistics only serve to build your thesis. It’s like only surveying Chinese people if they like eating rice and noodles.

My point is that stock investors can also be market timers too. Time your entry point.. your buy decision! What do you base your buying decision on?

Most poker pros say that beginners get into trouble because they’re playing too many hands… they end up chasing cards and blaming it on not catching the river, but the flawed decision was playing with marginal hole cards… looking for marginal chances of victory. Sound familiar?