I spent 30 years on the front lines of the stock market. I started out as a trader, and worked my way up the chain in the investment business. In the world of professional trading, it’s survival of the fittest. Those who have great ideas, but get beaten down by the market, don’t survive. The only way a professional trader can survive is by understanding the “rules of engagement” as they apply to investing. If a trader tries to guess about the future of prices, it won’t take very long before he gets wiped out. Professional traders can only survive and compete one way: by knowing the truth about what’s driving stock prices, and ignoring the myths.
This is not to say that the truth about the stock market is written down somewhere, in a neat little book that summarizes everything in terms of black and white. The nature of stock market truth lies in probabilities. There are only a few factors that truly impact stock prices, and the impact of each factor is constantly shifting over time. That’s why you see All Star Managers from one year crashing and burning the next year. Their “model” of factors influencing stock prices simply stopped working because the relative importance of the factors they used shifted.
At ZenInvestor we follow a short list of factors, and we remain agnostic about which factors are most important at any given time. Our models make use of probability studies and rigorous fundamentsl research to filter out as much of the ‘noise’ about companies as possible. By sticking to these basic, fundamental factors and not making bets on the future of stock prices, we tip the odds of winning slightly in our favor, which rewards us very well over time.
We will show you how to avoid fads, tricks, and traps in the market. The Zen of investing is to keep it simple, clear, and true.