Club Mulgoa

Friday, December 31, 2010

Equity vs Bank deposits

The simple rule that risk is proportional to returns/loss is well known. Short term, it does not mean much but as time goes on, the rule becomes more applicable.

2010 is a year when DH did badly. If people starts to ignore him in 2011, they would be fools. If TT did well in 2010, people would be fools too if they think I am better than DH. I get a huge number of leads from RB as well as from Hotcopper, Proactive, Minesite, Mineweb, Eureka Report and ASX Guru and of course the press. But to compete with the big ends of the city, I keep tab of ASX announcements. These are THE most important facts in the financial world, delivered legally at equal pace to the public and the financial institutions. While the big guns have powerful software for trading, it is analysis of announcements that is the most crucial.

This year, the stock market did poorly. This year, it is virtually dead. But that is only if you invested mostly in the top 20. My own portfolios are mostly made up of those below the top 200. Of course some have encroached into the top 200 but I consider mostly their origins when I bought them. Hence, I have done very well.... but unlike DH, I don't have any ardent followers. And I don't collect fees either. Another 2 years of successful investment, then maybe I should start to charge! No, not charging for the information I provide but charging so that the readers are more inclined to follow rather than glance.

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