"All true investing must be based on an assessment of the relationship between price and value. Strategies that do not employ this comparison of price and value do not amount to investing but to speculation." Warren Buffett
I was reminded of this quote after today receiving the usual ADVFN partner offer which urges readers to take advantage of an investment strategy which last year allegedly turned £2000 into £31,000. So what sort of leveraged strategy must this firm be offering? Long Short equity? Risk Arbitrage? Or perhaps a highly geared China fund? No according to ADVFN and the advertiser the somewhat inappropriately named Assett Investments, gambling on the horses is not betting but investing. I have a feeling that the Sage of Omaha would join me in the view that a fool and his money were damned lucky to come together in the first place.
Should anyone wish to learn more about the Investing methodology of Warren Buffett you could do alot worse than buying the "Essays of Warren Buffett." In a world infected with toxic get rich quick schemes, it is a pleasure to hear how the best investor ever has made his money. Full of common sense ideals with not a "power strategy" or Winteresque "cycle of abundance" in sight it serves as a timely reminder how the best plans are often the most simple.
Expect fun and games today in the market. We have important economic data out of the US between 13.30 GMT and 15.00 GMT. Gold is hovering around the psychological $400 level and there are some big stop loss orders accumulating in the Euro/$ market. (Members can see the levels on HarryBuzz). We might well have to wait though until 4.00 pm and the end of day fixing for these stop losses to get triggered but I have a feeling that they will be.
In equities, holding above yesterdays S&P low of 1122 in the S&P will be important. Also of interest will be the behaviour of the Semi-Conductor Index. yesterday it held above $500 but it has fallen 10% in the last two weeks and a further move lower could well start to spook the Bulls.
Thankyou to MoneyAM, and those who managed to brave the weather, for what proved to be an enjoyable seminar. I had been hoping that "Doji" Darren would send an acolyte to heckle me but alas did not happen. I hear that not all is well in Winters World and that some of his colleagues are abandoning ship. It seems that some people have found out that the Winters Investment is as much of an oxymoron as US intelligence!
Herr. Schadenfreude Harry
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