Came across some words of wisdom from a thread on a defunct investment forum, mainly from someone by the nick of "d.o.g.", acronym for "disciple of Graham". He's a fund manager, I think.
"Read The Millionaire Mind and it will be abundantly clear that - at least for those in the survey - their wealth came primarily from hard work - in their own careers, or in their own business. Only a very few credited successful stock/bond investment with creating their wealth, although many indicated that they had some money in the stock market. Most had assets of multiple types, including stocks, bonds, property and partial ownership in businesses, as places to "park" their idle money. But the way to "grow" their money was primarily:
1) working hard at their job or their business to grow their income; and
2) saving money to buy their assets.
...
Work hard, but save harder, insure against disaster, and invest wisely, in that order. Only after safeguarding against financial disaster should you aim for financial security (buy term and invest the rest). And the more you can save, the more you can invest. The more investment capital you start with, the less unreasonable your demands on it, and thus the better its chances of preservation and growth instead of shrinkage or even total loss. MARGIN OF SAFETY!" - d.o.g.
"1. Work hard to maximize income (from job or business)
2. Save hard to maximize investment capital
3. Insure appropriately to guard against financial disaster
4. Invest wisely to maximize returns" - d.o.g.
"Happiness is a state of mind and the best things in life need not be expensive." - teachme
"Wealth and happiness are not correlated, but neither are they exclusive. Aim to be rich AND happy, but if you can't attain wealth, at least be happy." - d.o.g.
"Traders treat stocks like inventory - they buy in order to resell. Investors treat stocks like assets - they buy in order to use. For inventory, the selling price is of prime importance. For assets, the utility (cash generation) is of prime importance." - d.o.g.
Source: http://www.wallstraits.com/community/viewthread.php?tid=59#pid447
4 comments:
Hi Dancerene,
Nice blog you have. Thank you for quoting from d.o.g. He's still on Wallstraits forum right now and has been actively posting (though on a sporadic basis).
All the best for your investments and wealth building, and hope we all can navigate safely through this severe downturn.
Cheers,
Musicwhiz
Hi,
Thks for posting on my blog. It's interesting that d.o.g and me have similar (if not the same) kind of thinking.
There are some people that I know who actually skipped the first two parts i.e. save hard, insure, and skipped to the investment part first. It's a recipe for disaster, I think. Hence, the reason for my post.
Good link up, Dancerene :)
Thanks musicwhiz, I like reading your blog too, can see that you've always given a lot of thoughts to what you've written.
All the best to you in your investment endeavour too.
Hi la papillion, so did you manage to get those people that you know, who skip the savings and insurance part, to read your blog? ;)
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