Archive for May, 2009
Beating the Market - The Chops Theory
Thursday, May 7th, 2009 | investing | 3 Comments
Nobody Can Beat the Market
Any investor who has been around a while has heard that they can’t beat the market. After hearing it so many times, you start to believe it. Pretty soon, you want to move all of your money into an index fund. Then you light your torch and grab your pitchfork ready to storm the gates of whoever tried to sell you an actively managed mutual fund with a high expense ratio. And if anybody still believed they could beat the market, they could be shown research that shows that the majority of actively managed funds fail to beat the market. But is it that simple?
How to Build Wealth, Part 3
Tuesday, May 5th, 2009 | Uncategorized | 3 Comments
Own Things That Produce Cash Flow or Appreciate in Value
Once you’ve learned to spend less than you earn (or earn more than you spend) you should start to see money piling up in your bank account. But this isn’t the end - that money is sitting there doing nothing! Your money is like a little army of dollars and you are the general. It’s up to you to deploy it properly, so that it starts earning more wealth for you. Lazy money that relaxes in a checking account earning 0.0001% interest doesn’t build wealth. You need to use it to own things that make money.