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Bernard M -- Taipei English Tutor

Bernard M - English Conversation / TOEFL / IELTS 一對一英文會話

Saturday, September 4, 2010

Markets are up and everyone wants to invest

Before you do, get some serious data from Triumph of the Optimists, hopefully available at a university library, or at least read the reviews.

Then check out Niederhoffer's Practical Speculation to rid yourself of stock market superstition. He takes a scientific, in particular a statistical approach to investing.
The lesson of both books is to invest for the long term. Although there are lots of glamorous alternatives--they don't actually work for the vast majority of people. They will just lose you money and sleep.

My suggestions:
  1. invest for the LONG term, at least 20 years or more
  2. use global or at least national index funds
  3. diversify out of the NT$
  4. cut your transaction costs to the bare minimum (ETFs, Vanguard Funds)
  5. focus on your career or business because value creation is more profitable than successfully measuring the value created by others, i.e. investing

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