Wednesday, September 23, 2009

How to blow more money

As a sequel to my previous blog about investing or blowing your money, here's an investment strategy that I have been roughly following:


“First, identify the quantity of cash to be put to work -- example: 20%. Second, break the trade into digestible chunks -- example: break it into four parts, 5% each. Third, implement the first trade today -- example: invest 5% into equities today. Fourth, set a date for implementing the second trade -- example: two months from today invest the second 5%. Fifth, implement third and forth segments if market pullbacks occur -- example: invest the remaining 10% of the cash on market pullbacks. And sixth, after the date of the second trade occurs, return to step one with the remaining cash -- example: two months from today, if the market never provides the opportunity to buy on a pullback, break the remaining 10% up into three to four parts and follow a strategy similar to the one utilized for investing the first 10%."


Source: Riverfront Investment Group’s strategy for committing new capital to stocks
Link: http://www.minyanville.com/articles/rich-bull-market-risk-emotion-positions-stocks/index/a/24583/p/1

My personal strategy veers from this a little bit. I keep researching stocks so that I am prepared to act when the date rolls around. Also, during my research should I come across a security that really appeals to me, I will pull the gun and trade prior to the defined date. If not, (and for the most part) we're back on the systematic investment tracks.

7 comments:

A Arora said...

not exactly what i expected from u, but i guess our blogs can be whatever we want them to be, right?

kage said...

guess that just means that the real me is a little different from your perception of me :)

which does beg the question: what did you expect?

A Arora said...

actually, the blog is exactly the perception of u, what u wld like people to believe u r. the real u, i'm afraid doesn't come out in the blog.
but then all of them are us in a way, the reality and the shadow both...

kage said...

au contrarie, my blog may be a veneer, and perhaps even a manifestation of how I want others to perceive me, but it can hardly be your perception of me. The latter is, fundamentally, not under my control. "Beauty is in the eyes of the beholder".

How we perceive others is often shaped by our own personalities.

Anyhoo, none of this answers the question "what did you expect?" :)

A Arora said...

if u do say that it is governed by how others perceive it, then i guess it does fall under the category of how i perceive it as well, doesn't it? and no, it is not under ur control, or mine...perceptions aren't...
i guess i expected more questions of significance that don't have answers, merely perceptions...that's a fair expectation, no?

kage said...

you mean like so?


http://ctecastronomy.blogspot.com/2009/02/meaning-of-life-by-chance.html


All the same, while the cause (“meaning”) for the struggle in life has been addressed, the underlying existential question or purpose behind it all still remains, i.e. “Why? Why go through the rigmarole of competing, of consuming, of procreating and to what end?” I suspect, I’m in the same boat as the rest of Creation on that one, because I just don’t know. Yet.

A Arora said...

no, not at all...i said 'of significance'