Skip to main content
Message Font: Serif | Sans-Serif
 
No. of Recommendations: 10
Prestone wrote:

I have only been a disciplined trader for roughly a year and a half (Have invested for 4 1/2), and it has been during what has been one of the strongest bull run ups in history. So, that would also lead to no proof as to whether trading can attain better results than GG. That being said, it just does not seem to be an unachievable task. My own personal CAGR since early '96 after all taxes and expenses beats that of INTC since '90.

Yes, you have only be trading for a very short and volatile time frame which even I was able to time quite well using no exotic strategy in the autumn of 1998. When the capitulation and lowering of interest rates signaled a unique opportunity I hadn't seen in the previous 15 years, I actually used margin as a strategy. However, I'm not looking or expecting that type of a scenario to occur very often. Maybe a blind squirrel would have had little trouble snagging over 100% returns in a short time frame like that (after taxes). However, the blind squirrel understands that they will not be able to repeat that on an annual or binannual basis - no matter how appealing it may seem.

I know that Bruce adds to his Gorillas often, so this may make it difficult to determine the true CAGR, I am not sure about Mike. I understand this is personal, but could you give a ballpark number on how long you have been GG'ing, and how much of GG that you attribute to your LT results? I am sure you were both doing your own versions of GG before the approach became known.

I wouldn't say 'often'. My wife and I have a dual income scenario and have had since the late 80's. We save on a regular basis and continue to put that money to work quarterly. No matter what happens in the markets, we will continue to use this strategy. We really live 'below our means' in a lot of ways because we're pretty happy and comfortable. This, in spite of a few highly successful investments in the past decade.

I do not present this as an argument that Trading is better than the GG approach. None of our results would be anywhere near scientific. Trading can not be drawn and quartered to be measured up as easily as GG can. It is safe to say that Trading has so many more variables to throw into the equation to determine what a trader is, and how one becomes successful with it.

No need to determine that one is better than the other. What is to determine is which strategy is one going to take the time to learn and use. Or how is one going to learn both in an effort to combine them and maintain success to reach one's goals. Each investor has their own discipline.

Curiousity got the better of me when Bruce mentioned INTC and wondered what the LT returns have been on it.

Although I don't mind sharing a little personal return information, it is not to be taken as any type of touting or 'look how easy it is'. I had to dig out my stack of buy orders and simply plugged in the date to the return chart using the appropriate dates. I simply stick with Intel for the moment. My returns are nothing compared to the 15, 20, 25 and 29 year time frame since the IPO in 1971.

The original Intel shares my wife and I purchased ten years ago have returned roughly 5,200%. We added shares three years later that have returned roughly 2,200%. We added more shares in the summer of 1995 which have returned roughly 700%. We bought our last additional shares in the autumn of 1998 which have returned roughly 225%. You would have to plug all of that information into your formula to determine annual return average for each as they are all the buy and hold strategy thus far. The compounded returns of the original shares certainly are starting to kick in with this investment for us. I'll be honest and say we got a higher return in a shorter amount of time with other stocks, but I'm just sticking with Intel in this illustration.

Whether or not one perceives the return on Intel as having been good, great or just so-so - I would like to wish those returns on all investors if I could. Regardless if they use a short term, mid term or long term strategy.

I have been a lurker, so I wanted to add thanks to all of you on this board that provide so much of your time to get your very insightful GG information out to others for sharing, and building upon.

Join in more often. The future is staring us right in the face.

BB
Print the post  

Announcements

What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.