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Investing As A Sport?
I said last week that money doesn't generally buy happiness, but the lack of it can buy absolute misery. This, by the way, is not just my personal observation. It is the conclusion of some of the most respected happiness researchers (Yes, there is such a thing -- read my book.) The trouble is that we have to pay attention to money more when we lack it than when we have it. This doesn't seem fair, but the Lord works in mysterious ways. Most people are invested in the stock market, either directly or through mutual funds, pension plans or some other vehicle. So it is hard not to be part of the Panic Crowd. But I ,in all my financial wisdom, have two golden rules to offer. These may not make you rich, but they will keep you happy. Number One: Place your investments in the safest vehicles possible (Do as I say, not as I do!) and forget about them. When the next recession ends, take inventory and see that you still have investments. Most of us don't get a rush out of watching our investments plunge or yo-yo up and down. Most people are happier when they forget they even have investments. Number Two: If you are one of those people with a terminal case of Itchy Trading Finger, then you probably would not be happy ignoring your investments. Place aside what you need for the long term, such as retirement if your heart lasts that long. Don't play with this money. Don't touch it. Trade only with "extra" money. The rest of you are asking, "What's that?", but Itchy Trading Fingers know what I'm talking about. They view stock trading as a sport. In fact, stock trading is a sport. Much more than, say, hunting. Think about it. In a sport, two equal opponents square off against one another. "Let the best one one win." Each faces the same challenges. Each is armed with the same weapons. Each has an equal chance of feeling the thrill of victory and the agony of defeat (unless, of course, you happen to be the Tampa Bay Devil Rays). Imagine the play-by-play if hunting truly was a sport: "Man is closing in. He's coming up from behind and rounding to the south side. He's raising his rifle. Deer doesn't even appear to notice. Oh, I can't watch. This is going to be a massacre. Wait! Deer has just bucked up and twisted. He spins around a tree, and -- look! Deer has a rifle too. He aims. He shoots! He Kills!!! Man is down. What an upset, ladies and gentlemen." In real life, Deer doesn't win very often. In fact, I estimate that Man is about 4.3 gazillion times more likely to be defeated by his own team mate than by the opposition. We call this "friendly fire". Contrast this to Itchy Trading Finger, who stands an equal chance of striking gold or of moving into a cardboard box on the street corner. The stock market truly is sport, for those who choose to treat it that way. Which is why it is so important to put aside -- in safe, secure investments -- the money you feel you need for your future. That way, when Itchy Trading Fingers retire, they can move out of the cardboard box. For the rest of us, we are happier getting our sport watching monster trucks crush WWF actors. Oops! There I go again, mixing my sports and my metaphors, not to mention ignoring several federal safety standards. May your investments be safer than my WWF friends, and may you sleep well at night. About The Author David Leonhardt is The Happy Guy. He is an energetic motivational speaker and author of Climb Your Stairway to Heaven: the 9 habits of maximum happiness. Visit him at
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It's Not the Size of Your Bank Account You might think that if you win the lottery or get a huge raise, all your problems will be solved. Sounds logical, right? Well, it might sound logical, but it isn't. Investigate Before You Invest "Through wisdom is a house built. And by understanding it is established. Annuity Help Many people today are looking for annuity help. The biggest challenge seems to be that most of the help is biased. Investors: Avoid These 5 Common Tax Mistakes For many investors, and even some tax professionals, sorting through the complex IRS rules on investment taxes can be a nightmare. Pitfalls abound, and the penalties for even simple mistakes can be severe. Short Selling for Investors Shorts. Let's see. Begging Your Trust in Africa The syntax is tortured, the grammar mutilated, but the message - sent by snail mail, telex, fax, or e-mail - is coherent: an African bigwig or his heirs wish to transfer funds amassed in years of graft and venality to a safe bank account in the West. They seek the recipient's permission to make use of his or her inconspicuous services for a percentage of the loot - usually many millions of dollars. Volatile Oil The Light Crude Continuous Contract fell from $67.70 a barrel on Monday to $62. Focus Your Investments on the Long Term "All human power is a compound of time and patience!" Honore de Balzac (1799 - 1850)Long term investing or "Buy and Hold" is not about hunches, emotions, stock tips, market timing or making quick profits! It's about using proven long-term strategies to accumulate wealth over time!A large part of the daily volume on the exchanges is due to traders who hope to make a small profit by taking advantage of small discrepancies in the pricing of securities, or who are able to buy a stock as soon a favorable analysts report is issued and who hope to profit before the inevitable runup.The instantaneous access to information that financial institutions have gives them an enormous advantage over the individual investor when it comes to short-term trading. Scots Beat Yanks in China Bank Deal With visions of an ATM in every neighborhood in China, foreign banks and investment firms are queuing up to join the "China Club."Moneybags CommunismThe initiation fee for the "China Club" is straightforward and pure moneybags communism: invest cold hard cash in its largely insolvent state-owned banks, put your reputation on the line, reassure nervous foreign investors about upcoming IPO's, and share your risk management, corporate banking and other expertise with eager Chinese executives. The Convertible Craze Brightens The Future Of Equities Convertibles are stealing the show with their safe investment image in today's "protective" market. They seem to be overshadowing the stocks and bonds, and this holds true for the mediocre issuers. The Perfect Mutual Fund The Perfect Mutual Fund is the one you build yourself!The perfect Mutual Fund you build should have the objective of owning no more than 12 to 15 companies; owning shares in 12 companies would allow the diversity needed to sleep well at night and would provide a cash dividend every week of the year.The 12 companies (with staggered dividend payout dates) in your perfect Mutual Fund should not only provide a cash dividend every week of the year, the companies should also have a historical record of raising their dividends every year for at least the past 8 years (to eliminate risk). Consolidation Period The economic data reported Fri showed continued above trend growth with disinflation (at the core level, excluding food and energy) in the second quarter. Real output growth has slowed from about 4% in 2003 & 2004 to just over 3 1/2% so far this year, while a core inflation rate fell from 3% last quarter to 2%. Day Traders and Swing Traders and Options? Maybe! Typical day traders and swing traders look for stocks with quick, short term movements, and are not in the business of holding positions overnight let alone a week or two. So the use of options has not usually been a component of their trading strategies. How To Start Investing For Financial Independence, Part 1 Today, I am going to start a multi-part series about how to go from being a beginning investor to being "financially independent" in a steady and predictable way. At our website, we get tons of e-mails about how do I start, how do I start with little $'s, etc. Wit and Wisdom on Money, Wall Street and Success - Part #1 I love to collect quotes as they concisely promote a philosophy which is readily understandable.In my 25+ years of investing I have collected hundreds of quotes related to Wisdom, Wall Street and Success. Stock Market Leaders and Laggards Leaders are stocks that breakout immediately when the market confirms a new rally. In the first several weeks, strong stocks with leadership ability will breakout on volume above their 50-day average. Introduction To FOREX The Foreign Exchange Market, better known as FOREX, is a worldwide market for buying and selling currencies. It handles a huge volume of transactions 24 hours a day, 5 days a week. 5 Day Trading Tips for Success 1. How to Treat Gap Openings A gap up or gap down open is an emotional move, and it often will reverse course and turn in to "trap open". Why You Need To Buy and Sell Gold Coins (Part 3) Putting Rare Coin Market Cycles to Work for You.. Asset Location - Increase Investing Returns & Reduce Your Taxes Location - Once the holy grail only for real estate investors is fast becoming the mantra for every stock, bond, and mutual fund investor. Experts and studies now recognize managing asset location is second only to asset allocation in determining the success of your investment returns.
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