Comments on: The ONLY three ways to invest in stocks … and, some ways NOT to … http://7million7years.com/2008/03/29/the-only-three-ways-to-invest-in-stocks-and-some-ways-not-to/ How to make 7 million in 7 years ... Thu, 24 May 2012 01:26:57 +0000 hourly 1 http://wordpress.org/?v=3.3.2 By: Beat 80% of professional fund managers!- 7million7years http://7million7years.com/2008/03/29/the-only-three-ways-to-invest-in-stocks-and-some-ways-not-to/comment-page-1/#comment-6731 Beat 80% of professional fund managers!- 7million7years Sat, 18 Sep 2010 06:09:05 +0000 http://7million7years.wordpress.com/?p=92#comment-6731 [...] at Watson Inc. outlines a sensible ‘system’ – one that I have spoken about before – that beats “80%-90%” of professional fund managers [my highlights]: Some [...] [...] at Watson Inc. outlines a sensible ‘system’ – one that I have spoken about before – that beats “80%-90%” of professional fund managers [my highlights]: Some [...]

]]> By: Dizzle http://7million7years.com/2008/03/29/the-only-three-ways-to-invest-in-stocks-and-some-ways-not-to/comment-page-1/#comment-3447 Dizzle Wed, 26 Aug 2009 12:49:50 +0000 http://7million7years.wordpress.com/?p=92#comment-3447 Yay everyone wins. No one loses money. Buy now! Yay everyone wins. No one loses money. Buy now!

]]> By: The Myth of Diversification « How to Make 7 Million in 7 Years™ http://7million7years.com/2008/03/29/the-only-three-ways-to-invest-in-stocks-and-some-ways-not-to/comment-page-1/#comment-573 The Myth of Diversification « How to Make 7 Million in 7 Years™ Mon, 02 Jun 2008 08:54:55 +0000 http://7million7years.wordpress.com/?p=92#comment-573 [...] you’ve read my posts on the only three ways to invest in stocks and the follow-up post that quoted some of Warren Buffet’s views on Index Funds vs direct [...] [...] you’ve read my posts on the only three ways to invest in stocks and the follow-up post that quoted some of Warren Buffet’s views on Index Funds vs direct [...]

]]> By: Don’t let all of those stock investment choices fool you … « How to Make 7 Million in 7 Years™ http://7million7years.com/2008/03/29/the-only-three-ways-to-invest-in-stocks-and-some-ways-not-to/comment-page-1/#comment-572 Don’t let all of those stock investment choices fool you … « How to Make 7 Million in 7 Years™ Tue, 20 May 2008 14:20:10 +0000 http://7million7years.wordpress.com/?p=92#comment-572 [...] wrote a post recently that summarized these options; here I simply want to add a little more info [...] [...] wrote a post recently that summarized these options; here I simply want to add a little more info [...]

]]> By: What is the best way for a newcomer to get started in investing in stocks? « How to Make 7 Million in 7 Years™ http://7million7years.com/2008/03/29/the-only-three-ways-to-invest-in-stocks-and-some-ways-not-to/comment-page-1/#comment-571 What is the best way for a newcomer to get started in investing in stocks? « How to Make 7 Million in 7 Years™ Wed, 07 May 2008 12:53:44 +0000 http://7million7years.wordpress.com/?p=92#comment-571 [...] - Warren Buffett’s company - so, it’s timely that I remind you there are only a TWO sensible ways to INVEST in stocks - BOTH recommended by Warren Buffet  - plus one Speculative [...] [...] – Warren Buffett’s company – so, it’s timely that I remind you there are only a TWO sensible ways to INVEST in stocks – BOTH recommended by Warren Buffet  – plus one Speculative [...]

]]> By: AJC http://7million7years.com/2008/03/29/the-only-three-ways-to-invest-in-stocks-and-some-ways-not-to/comment-page-1/#comment-570 AJC Sat, 05 Apr 2008 19:49:48 +0000 http://7million7years.wordpress.com/?p=92#comment-570 @ Iris - Thanks! Let me know your progress as you go along ... @ Iris – Thanks! Let me know your progress as you go along …

]]> By: Iris http://7million7years.com/2008/03/29/the-only-three-ways-to-invest-in-stocks-and-some-ways-not-to/comment-page-1/#comment-569 Iris Sat, 05 Apr 2008 16:10:04 +0000 http://7million7years.wordpress.com/?p=92#comment-569 Great! Thanks for the advice. I'm adding you to my favorites. Great! Thanks for the advice. I’m adding you to my favorites.

]]> By: AJC http://7million7years.com/2008/03/29/the-only-three-ways-to-invest-in-stocks-and-some-ways-not-to/comment-page-1/#comment-568 AJC Tue, 01 Apr 2008 16:42:47 +0000 http://7million7years.wordpress.com/?p=92#comment-568 @ Moresby Chief (is that New Guinea?) - thanks for a great question: now, I don't invest in 'product' so I'm probably not the best person to ask, so I will refer you to the 'highest source' of advice on this particular subject that we can get, Warren Buffet, who says: 1. If you don't know what you're doing buy the whole market 2. Buy your stocks at the lowest cost - as the fund that charges more has to return that much more 3. Use the fewest intermediaries / middlemen ... they all add to the cost. I would add that history is not necessarily a great predictor of the future ... On the other hand, it is true that a few people do consistently beat the market: Warren Buffet is one! It may be that your fund is another ... but, do you want to take that chance? If I was going to 'choose' fund managers, I would rather become an expert in choosing stocks ... and cut out ALL the middlemen! @ Moresby Chief (is that New Guinea?) – thanks for a great question: now, I don’t invest in ‘product’ so I’m probably not the best person to ask, so I will refer you to the ‘highest source’ of advice on this particular subject that we can get, Warren Buffet, who says:

1. If you don’t know what you’re doing buy the whole market

2. Buy your stocks at the lowest cost – as the fund that charges more has to return that much more

3. Use the fewest intermediaries / middlemen … they all add to the cost.

I would add that history is not necessarily a great predictor of the future …

On the other hand, it is true that a few people do consistently beat the market: Warren Buffet is one! It may be that your fund is another … but, do you want to take that chance? If I was going to ‘choose’ fund managers, I would rather become an expert in choosing stocks … and cut out ALL the middlemen!

]]> By: MoresbyChief http://7million7years.com/2008/03/29/the-only-three-ways-to-invest-in-stocks-and-some-ways-not-to/comment-page-1/#comment-567 MoresbyChief Tue, 01 Apr 2008 14:33:51 +0000 http://7million7years.wordpress.com/?p=92#comment-567 ACTIVE OR PASSIVE FUNDS? I saw your reply to my post on Tickerhound, thanks. As I wrote in my question, so many articles out there say that investing in managed funds is fairly pointless as they rarely beat the index over time. This did seem to make sense to me - after all how many people *really* know what's going on? A lot of it is just down to luck, which will average out over time. BUT - I can see a lot of funds which DO significantly outperform - and as I understand it the returns you see on a website like Morningstar include the annual costs, as this is worked into the price of the fund anyway. So when comparing with a tracker fund, you are comparing like with like. I go through a broker that discounts funds and as a result enables you to invest in a large number of funds with zero upfront cost (no-load). With this in mind, does it make sense to go for a fund which has outperformed in the long-run? Of course, they may have outperformed as a result of taking more risk, and this is a fair point - however over the long, long term (15-20 yrs) surely this risk is reduced? It's not like I'm putting all my cash in some crazy hedge fund. I really want to get this right as I want to just buy 5-6 funds and leave them to dollar-cost average for 15-20 years. I feel like it's worth the time to put in the research now and make the right decision. Any further advice on this would be greatly, greatly appreciated. ACTIVE OR PASSIVE FUNDS?

I saw your reply to my post on Tickerhound, thanks.
As I wrote in my question, so many articles out there say that investing in managed funds is fairly pointless as they rarely beat the index over time. This did seem to make sense to me – after all how many people *really* know what’s going on? A lot of it is just down to luck, which will average out over time.

BUT – I can see a lot of funds which DO significantly outperform – and as I understand it the returns you see on a website like Morningstar include the annual costs, as this is worked into the price of the fund anyway. So when comparing with a tracker fund, you are comparing like with like.

I go through a broker that discounts funds and as a result enables you to invest in a large number of funds with zero upfront cost (no-load). With this in mind, does it make sense to go for a fund which has outperformed in the long-run? Of course, they may have outperformed as a result of taking more risk, and this is a fair point – however over the long, long term (15-20 yrs) surely this risk is reduced? It’s not like I’m putting all my cash in some crazy hedge fund.

I really want to get this right as I want to just buy 5-6 funds and leave them to dollar-cost average for 15-20 years. I feel like it’s worth the time to put in the research now and make the right decision.

Any further advice on this would be greatly, greatly appreciated.

]]> By: blogrdoc http://7million7years.com/2008/03/29/the-only-three-ways-to-invest-in-stocks-and-some-ways-not-to/comment-page-1/#comment-566 blogrdoc Sun, 30 Mar 2008 12:49:16 +0000 http://7million7years.wordpress.com/?p=92#comment-566 Well... obviously, you've done well for yourself anyway. But it's funny b/c your story reminds me of my first job out of school and I decided not to buy a house since I was unsure if I'd be there for longer than the pay-out-period for owning a home. Unfortunately for me, my estimate of a 2-3 yr payout period was off by 2-3 years. :( Well… obviously, you’ve done well for yourself anyway. But it’s funny b/c your story reminds me of my first job out of school and I decided not to buy a house since I was unsure if I’d be there for longer than the pay-out-period for owning a home. Unfortunately for me, my estimate of a 2-3 yr payout period was off by 2-3 years. :(

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