Send Online Flowers:fresh From
Home  |  About  |  Articles  |  Reports  |  Links  |  Site Map    
Welcome to Send Online Flowers:fresh From!
Gifts Articles
•
•
•
•

Home
:: About Us
:: Contact Us
:: Article
:: Reports
:: Links
:: Site Map

Related Links

Christening Invitations

Photo Frames

Equestrian Gifts

Personalised Favour Boxes

Mini Moto Parts
Buy and Hold: How to Perpetuate Your Investment Losses
By Ulli G. Niemann


A recent cartoon in my daily newspaper showed two guys sitting in a bar. One is saying to the other: ?I did learn something from my broker...how to diversify my investment losses.?

While this struck me as funny, there is certainly an element of truth to it judging by the number of tragic e-mails and phone calls I have received over the past couple of years.

This was brought home even more so by a reader who responded with strong disagreement to one of my articles. I advocate a methodical, disciplined approach to investing in no-load mutual funds. It keeps me invested during up markets and on the sidelines during down markets. It was exactly this approach that got me and my clients out of the market in October, 2000 and put us back in to take advantage of the April, 2003 upswing.

Judging from the reader?s e-mail it appears that he works for a major bank and is adamant about Buy & Hold and Dollar Cost Averaging. Maybe it`s the approach he has chosen and he doesn`t like hearing that the emperor is wearing no clothes. Nothing personal, honestly, but I find it incomprehensible that anyone, after the bear market and the financial disasters most people experienced, can even consider such theories. The results are just too black & white.

Here are his three main points:

  1. "There is no real feasible way to know whether the market is going to be up or down and when exactly to invest.
  2. "The only logical way for an investor to make money is through the buy and hold approach. This method is used by Warren Buffett and he has consistently beaten the best with an average annual return of 29%.
  3. "Dollar cost average helps to hedge against the ups and downs of the market; moreover, one should have been buying up stocks during the last 3 years, though I do agree with your cashing out at in 2000. I do not wish to insult you, but that seems to me more luck than intuition."

It appears that the only thing that I can agree with him on is, as he says, there is no reasonable way to "know" whether the market is going to be up or down. However, this statement also underscores that he is not familiar with trend tracking methodologies and the idea that one does not need to "know" or "predict" in order to make profitable investment decisions.

I`ve put together the composite for my trend tracking index in the 80s and it has consistently served me and my clients well by getting us into and out of the markets in a timely manner.

The reader cites Warren Buffett`s success. Sure, he is legendary, but remember that he made most of his fortune during one of the greatest bull markets. He is probably now considered beyond good and evil. But what about the numerous stories in the press over the past 3 years of the heavy losses he sustained in Coca Cola and other stocks, by stubbornly holding on to this positions. When you have enough money invested in a wide range of holdings, you become almost bullet proof. Do you fit in that category?

Furthermore, Buffet has resources available that the investing public simply does not have. Saying that he is successful only because of his buy and hold approach, and everyone following this technique will be too, is an oversimplification and does not factor in all the issues.

How many non-millionaires have enough spare capital to keep buying and holding and buying some more while stocks plummet? How long can they wait for the upswing when their cost-averaged holdings will start to show a profit? Do the math! Yes, the market will eventually turn up. But will it recover enough fast enough to reverse your losses in time to do you any real good? If you`re 20, then maybe. If you`re 60, who knows?

I have received countless e-mails and phone calls from individuals who have been led astray by brokers, financial planners and others using buy-and-hold and dollar cost averaging. Stories abound of retirees having to go back to work just because someone told them that "the market can`t go any lower" or "let`s dollar cost average."

As for his last point, when I gave the signal to cash out on October 13, 2000, it had nothing to do with either luck or intuition. I had no clue how good of a call that would be; I simply let my indicators be my guide. They pointed to a sell, we considered, and then followed through based on our experience. We held true to our philosophy and kept our emotions, speculations, fears or greed out of the equation. This disciplined approach is what I advocate.

This year it has led us to buy back into the market on 4/29/03. And my detailed analysis and evaluation of a range of funds led us to select some of the best; my top fund being up some 50%.

So, not to be cynical, but to me dollar cost averaging is just a way to spread the pain over a longer period of time and to cloud the obvious with the hope the market will turn around tomorrow. After all, it can`t go any lower. Can it?

For more information about this article and/or the author visit mailto:ulli@successful-investment.com

For more information, news and articles see:

Fun And Novelty Gifts - Fun And Novelty Gifts
...there`s a wacky supplier of such items online. This fantastic range of fun and novelty gifts, are sure to bring smiles to the faces of anyone who receives them. There are fun and novelty gifts for e...
Visit Fun And Novelty Gifts...

Telescopes - Telescopes
...programme and do you have a fascination with deep outer space? Do you long for telescopes that can let you star gaze at night and would you like to learn more about Astronomy? If you are a novice As...
Visit Telescopes...

Clothing - Clothing Ideas For All
...ons to suit and satisfy their tastes. This is because the clothing industry has boomed all over the world. There is almost no shortage of clothing of any kind. You can shop at local stores as well as ...
Visit Clothing...

Aromatherapy Scented Candle - Aromatherapy Scented Candle
... which enables people to increase their physical and mental well being through the use of essential oils as well as plant oils. These essential plant oils have been known to provide obvious physical a...
Visit Aromatherapy Scented Candle...

Platinum Jewellery - Platinum Jewellery
...Popping the big question is a monumental occasion in any man`s life. The apprehension and tension will be unbearable as he waits for the all-important answer. Of course, things might run a little sm...
Visit Platinum Jewellery...

Thank You Gifts - Thank You Gifts
...ts somebody for doing something special. You might want to say thanks to a friend or family member who has helped you in some way with their kindness. Perhaps you are a company boss who wants to tha...
Visit Thank You Gifts...

Fun Washing Up Gloves - Fun Washing Up Gloves
...ou can protect your hands in fun surroundings and treat them to a wonderful range of fun washing up gloves. Washing up needn`t be a boring affair when you can brighten up the sink with fun washing up...
Visit Fun Washing Up Gloves...

Wholesale Wedding Favours - Wholesale Wedding Favours
... will hold the imprints of your wedding? Look no further, for we at The Favour Store offer you a wide variety of Wholesale Wedding Favours. These favours are basically small gifts that are distributed...
Visit Wholesale Wedding Favours...

Radio Controlled Toys - Radio Controlled Toys
...However, there are a few Radio Controlled Toys that are made for expert users. Spend your leisure time enjoying yourself with our Radio Controlled Toys, which include aeroplanes, cars and many other k...
Visit Radio Controlled Toys...

Trainers - Trainers For Your Feet
...re several kinds of trainers in the market. The reason for different kinds of trainers being made is because of the specialization of each sport. This is because each sport is played on a different su...
Visit Trainers...

Diamond Engagement Rings - Diamond Engagement Rings
...`s new designer collection for 2006 includes a major emphasis on platinum diamond engagement rings and wedding bands. Using fancy cut stones in simple but effective engagement ring designs. ...
Visit Diamond Engagement Rings...

Bespoke Jewellery - Bespoke Jewellery
...ewellery as a gift is sure to get a great response. Quality items of bespoke jewellery make wonderful gift ideas and they will make fantastic fashion accessories for a variety of wardrobes. Commissi...
Visit Bespoke Jewellery...

Engagement Ring - Engagement Ring
...yet wearable. A platinum engagement ring should reflect the strength of the metal and the beauty of the diamond. The design of the engagement ring should also complement the design of the wedding ring...
Visit Engagement Ring...

Headphones - Headphones
...exercise and the ones which came with it were the wrong size for my ears, they were constantly falling out and becoming a mither when I was trying to run and do other exercising. I decided to do my ow...
Visit Headphones...

Horse Gifts - Horse Gifts
... our household and my eldest daughter is mad about horses and ponies. If she was allowed to she`d be going horse riding every day and she`d be down at the stables during all of her spare time. Due to...
Visit Horse Gifts...

Audio Equipment - Audio Equipment
... the process of making minor changes in the house just to brighten the place up, and give it a fresh new feel to it, when I spotted the audio equipmentI have now on a popular website. I decided to do ...
Visit Audio Equipment...

Christening Invitations - Christening Invitations
...A Christening is one such occasion that has been given extreme importance as it is considered to be the beginning of a new life. Celebrating this new life is a must for Christian families. To have a g...
Visit Christening Invitations...

Inkjet Cartridges - Inkjet Cartridges
... I was forever going through inkjet cartridges for my printer. It seemed that no sooner had I printed off one essay, another assignment was due in. I lost track of the number of sheets of paper I us...
Visit Inkjet Cartridges...

Boys Toys - Boys Toys
...d visit our Boys Toys category. We guarantee that they will definitely find a toy that they will love. If you need to purchase a gift for a friend, who happens to be a boy, our Boys Toys category is t...
Visit Boys Toys...

Spotting Scope - Spotting Scope
...elescope that is normally used for the purpose of observing earthly objects. A Spotting Scope has a general magnification around the order of 20X to 60X. Its features are similar to those of regular t...
Visit Spotting Scope...

Sweets - Sweets
...ets and do you like to savour them as often as you can? Many people like to treat their taste sensations to sweets and there`s no harm in having the odd sweet every now and then. Children in particu...
Visit Sweets...

Toppers And Embellishments - Toppers And Embellishments
...people to push their creativity to the limit. It also allows people to produce phenomenal results that are bound to help them gain recognition and appreciation in this form of art. Card making has bee...
Visit Toppers And Embellishments...

Tea Tree Oil - Tea Tree Oil
...good use by people around the world. For those in the know they use tea tree oil as a type of relief when they have a cold. The winter in the UK can be quite a bleak affair with plenty of flu and co...
Visit Tea Tree Oil...

Corporate Sweet Gifts - Corporate Sweet Gifts
...e build up to Christmas. Plenty of products make great types of corporate gifts and some cater for people with sweet teeth. A company can give out corporate sweet gifts and they are sure to be welco...
Visit Corporate Sweet Gifts...

Corporate Aircraft Charter - Corporate Aircraft Charter
...ticular destination safely or if you need to get somewhere as quickly as possible. Corporate Aircraft charter is also required when a group or staff of a company needs to travel from one place to anot...
Visit Corporate Aircraft Charter...

New Born Photography - New Born Photography
...ts invest in new born photography as they want idyllic images that can last forever. The new born photography is taken by a professional photographer who specialises in capturing family images. They...
Visit New Born Photography...

Organic Body Care Products - Organic Body Care Products
...with increasing fluctuations in today`s environment. People have also become excessively aware of this requirement and are, hence, constantly indulging themselves in treatments and products that would...
Visit Organic Body Care Products...

Equestrian Gifts - Equestrian Gifts
...e occasionally buy her Equestrian Gifts because we know how much she loves the animals. She tends to ride as much as she can and we know that anything related to horses will be a safe bet if we are s...
Visit Equestrian Gifts...

Rolex Watches - Rolex Watches
... now. In fact, it has been a sponsor of important events. One important event that it is associated with is Wimbledon Tennis that is held annually. rolex watches are known for their unique looks and o...
Visit Rolex Watches...

Private Aircraft Charter - Private Aircraft Charter
...ate aircraft charter in order to reach a particular destiny safely, quickly and in luxury. There are various types of private aircraft charter services. Helicopters are also hired for you to travel in...
Visit Private Aircraft Charter...

Original Ink Cartridges - Original Ink Cartridges
...crashes on you and when the printer needs refilling with original ink cartridges or inkjet paper. Take a trip to your local high street though and you`ll find replacement original ink cartridges to b...
Visit Original Ink Cartridges...

Photo Frames - Photo Frames
... mounts will be ideal as they truly make the prints look highly impressive. Your pictures will look marvelous when they are united with picture mounts as these products can present pictures in a very...
Visit Photo Frames...

Corporate Gifts - Corporate Gifts
...imes of the year businesses like to bestow corporate gifts on their staff or valued clients to show them how much they are appreciated. Typically the corporate gifts are given out at Christmas althou...
Visit Corporate Gifts...

Jewellery Making Findings - Jewellery Making Findings
...d. It gives people more of a reason to dress up and look good while mixing and matching their apparel. Although you can find a wide range of jewellery in the market available in all sorts of designs, ...
Visit Jewellery Making Findings...

Child Portrait Photography - Child Portrait Photography
...raphy conducted by a professional photographer who is highly experienced at grabbing the perfect moment. You and your baby could be caught in a cosy cuddle if you opted to have the child portrait pho...
Visit Child Portrait Photography...

Messenger Bags - Messenger Bags
...looking for suitable Messenger bags for my son, he is beginning his final crucial year at school in September and I want him to have everything he needs so he can concentrate on his work. We have alre...
Visit Messenger Bags...

Picture Frames - Picture Frames
...s firmly behind because they have a fabulous collection of fine frames in store. These funky picture frames are suitable for many purposes and once you place them on your walls they`ll look simply st...
Visit Picture Frames...

Christening Invitations - Christening Invitations
...read for babies and infants who are to be baptized and Christened. Christening invitations are also distributed when young children are permanently included in the fold of Christianity. There are nume...
Visit Christening Invitations...

Promotional Merchandise - Promotional Merchandise
...T-shirts, pens, USB flash drives, key chains, mugs, mouse mats, badges, hats, etc. The list goes on and on. You can go to a company and have your Promotional merchandise manufactured for you. They hav...
Visit Promotional Merchandise...

Cartier Watches - Cartier Watches
...tch brand in the market. Indeed, if you want to be noticed easily when you attend any social event, you should wear one of these watches. These watches are known for their style and elegance that is m...
Visit Cartier Watches...

Aromatherapy Oils - Aromatherapy Oils
...to peruse the aromatherapy oils and you`ll come across many useful oils that can have specific purposes. If you find that you suffer from lack of sleep then lavender can be just one of the oils on th...
Visit Aromatherapy Oils...

Personalised Favour Boxes - Personalised Favour Boxes
...r boxes. These include; personalised 4 Truffle Ballotin Boxes, Personalised Heart Style Boxes, Personalised Large Chest Boxes and others. All these boxes implement high quality materials, and are desi...
Visit Personalised Favour Boxes...

Business Gifts - Business Gifts A Nice Surprise
...ness gifts is one way to show that you care for your clients. You can give business gifts to market your products or services in a subtle manner as a gift is considered a token of appreciation and the...
Visit Business Gifts...

Leather Man Bags - Leather Man Bags
...tely we are going to different ones, however we can catch up at the weekends and the breaks could do us good. I wanted to get him a present before we both leave and I know he has been looking for Leat...
Visit Leather Man Bags...
Click For More Detailed Information on:
Home  |  About Us  |  Contact Us  |  Articles  |  Special Reports  |  Links  |  Site Map
Copyright © 2003-2008. All Rights Reserved.


Valid CSS!