Sunday, 30 October 2011

Fastest Way of Making Money

Do you believe that doubling your money every four-five years is a slow and boring process? Do you think you/your fund manager can surely get 40-50% return from stock market every year? Do you think that you can time the market? If your answer is Yes, then this post is for you, my dear friend.

Today, I plan to reveal the Fastest Way of Making Money as a Diwali Gift!! Yes, I have a strategy for that. Just follow my strategy & you ll make money so rapidly that even Jhunjhunwala ll come to you for tips! I am not kidding. Strategy is not too complicated either. In fact, it is very very simple & easy strategy.

Here is the strategy- BE A FOOL. No, this is neither a typo nor am kidding. The strategy is this only. BE A Fool.

Let me explain- There are three kinda people who operate/compete in the market.

1) Intelligent- These investors try to value a business & compare value with price & take their decisions irrespective of emotions. They follow their father's approach which he has given to them in a book called "The Intelligent Investor". As 'magic formula' man and value investor Joel Greenblatt says- "If we don't know how to value a business, we can't invest in it intelligently." So, these 'alleged' intelligent investors try to value a business & buy with a margin of safety. If they can't value, they move on.

2) Greater Fool- These investors (Forgive me Graham for calling them investors) follow the herd & are always late to the party... Because of chasing consensus, they buy at sky-high prices & sell at rock-bottom prices and a result lose everything.

3) Fool- Now since, intelligent investors walk away when they can't value something or if something is not dirt cheap; they leave a lot of money on the table. These guys pick that money & some more from greater fools & hence can make huge money. Read here.
True There Are No Free Lunches, but You Can Make Someone else Pay For Your Lunch & greater fools pay for their lunch.

If you fall in this category of stock market players, there is huge money in the making. Let me give an example. A overpriced IPO has come in bull market. You Subscribe.... Intelligent guys ll avoid it... so less competition... You ll get a lot of shares.... Bull market has become peak of bull market... Sell on listing day to greater fools at huge premiums... Make a killing... Bull market ll run of steam... Greater fools ll lose money... U enjoy!!!

You may ask- "Why ll it list at a premium on listing day?" I ll say- "Buy Low and Sell High. Subscribe only if it ll list up. Don't subscribe, otherwise."

Yes a little problem is there.
"If You find Greater Fool, you make a killing. If you don't find, Then You are the Greater Fool, my dear friend".
Kinda similar to Warren Buffet saying, "If you have been playing poker for half an hour and you still don't know who the patsy is, you're the patsy".

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