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Subject:  Re: AOL Article Date:  7/3/2006  1:45 PM
Author:  pencils2 Number:  1298 of 7325

Hi skierdena,

I'm glad you've found your way to the board, I'll try to answer your questions.

To start off, stop watching the market hour by hour every day. That is not how you get a hold of investing. Stop day-trading and following Wall Street, and start looking for some great companies. Day trading takes way too much time, you spend a ton of money on commissions, and you become more greedy, rather than having the feeling of seeing your stocks go up over the long-term. So, from now on, don't wake up at 4 AM to follow Bloomberg. Get your rest, and spend the time you can researching the companies you know and love. Become an investor, not a trader.

I would love to be able to quit and trade the market everyday.

This is not at all what I'd recommend. I never have traded or followed the market day by day for a while. I really don't care if Hansen goes up .5% or 3% today. All I care about is that my estimates for the company five years out are on target. Again, more than half of the time day traders lose money because of commissions. When investing for the long run you save time from having to always look at a screen and waiting for a stock to go down 5 cents. I have to say it one more time, investors 9 times out of 10 will have more satisfactory results than traders will.

know you are a long term investor, not a day trader.. can you recommend some good sites to go to actually learn about investing, terminology, how to short trade (scares me to death), how to get a pulse for the market on a daily basis.

Where you are right now can answer most of those questions. I made an archive of articles written by the Fool on valuation, sorting, and market terms and jargon: has a whole lot of information on investing as well. I put together an archive of some of their articles and tutorials:

You might find some information on my web site,, useful as well. I also recommend that you read some of the classic investing books, or simply follow the reading list Tom Gardner has put together:

One Up on Wall Street, by Peter Lynch
Buffett: The Making of an American Capitalist, by Roger Lowenstein
Value Investing With the Masters, by Kirk Kazanjian
The Davis Dynasty, by John Rothchild
Valuegrowth Investing, by Glen Arnold

Junior High

The 5 Keys to Value Investing, by J. Dennis Jean-Jacques
Beating the Street, by Peter Lynch
Investment Fables, by Aswath Damodaran
The Vest Pocket Guide to Value Investing, by C. Thomas Howard
Common Stocks and Uncommon Profits, by Philip Fisher

High School

Made in America, by Sam Walton
Forbes' Greatest Investing Stories, by Richard Phalon
John Neff on Investing, by John Neff
The Intelligent Investor, by Benjamin Graham
The Money Masters, by John Train


Stocks for the Long Run, by Jeremy Siegel
Quality of Earnings, by Thornton Oglove
Investing in Small-Cap Stocks, by Christopher Graja and Elizabeth Ungar
The Book of Investing Wisdom, by Peter Krass
You Can Be a Stock Market Genius, by Joel Greenblatt

Grad School

Break Up!, by Campbell, Koch & Sadtler
Investment Gurus, by Peter Tanous
Value Investing: A Balanced Approach, by Martin Whitman
Value Investing: From Graham to Buffett and Beyond, by Bruce Greenwald
The Road to Serfdom, by F.A. Hayek

Fellow Fool Tom Engle (TMF1000) also put together a great archive of Foolish articles:

I can't help you with how to tell if the market is going to go up or down, simply because I'm not interested in that technique of investing (Or trading). I am trying to do all I can to get you away from trading in the market, but if that is the road you want to take that is your decision. But if you want advice for how to time the market, I am not your man.

I bought google this year and could have made quite a lot of money trading it everyday, but can't quite get when it's going to go up or down. I'm tired of buying high and selling low.

Google is a good example of how long-term results beat out short-term results. Let's say you bought some Google on its IPO day at $90 and sold the same day for $95. A quick short-term gain. Then you fast forward just a couple years further and the stock is trading above $400. That measly $5 gain you made in a day could have turned into a 450% gain in a couple of years. You buy a quality company at a price you are comfortable with and in many cases you will be satisfied with the results.

Let me know if you have any more questions, I'm glad you're here! And if I do start some type of a newsletter I will definitely let you know. ;)


David K (pencils2)
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