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One secret of investing is time.
For example, perhaps you have some edge and you are able to effectively time the market. I don't know anyone who can do this reliably. If your crystal ball is working, could you pass it along for a few minutes?
Another approach is buy and hold. That is, you can win with time-in-market. Buy stocks and just hold, hold, This can be very effective if you're collecting dividends, or if you happen to pick a good company with good growth. Ideally, both.
Still another approach is taking the long view. The idea here is that markets move in cycles. You don't get caught up in momentum, or growth, or dividends. Instead, you read the headlines. When there's euphoria, you sell. When the pigs are fat you take them in for slaughter and cash in. When there's "blood in the streets" and everyone is saying it's the end of the world, you buy. You do this over years.
Don't think it can be done?
It's an old, excellent read.
(Hat tip to Jae Jun for passing the image along.)
I also want to remind you that time is the enemy of a bad business but the best friend of a great business. That's merely a simple way of saying that growth and compounding work best over time.
At any one slice of time, it's nearly impossible to "know" a business is great. But, time will tell. Also, this is the power of a track record. Real data, over a long period of time. The past doesn't tell us the future - looking in the rearview mirror isn't the ultimate solution. However, it does help the mind.
...smart people usually stay smart. And idiots, well...
Perfect timing for me to drop in a note from my journal:
August 22nd, 2016:
"The attention you give something tells you its value. You can fool yourself into thinking this isn't true but over time, attention and value are inexorably tied. More time, more energy, more value. Careful not just about where your eyes wander, but also where the mind goes."
~ John S. Rhodes
Publisher & Founder
RHODES to WEALTH
p.s. Plenty of great comments about Poor Charlie's Almanac from my note yesterday. Thanks to all you send me news, updates, notes, and more. I cherish all feedback.
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