Firstly if you read my post you will see that I am not knocking trading at all. What I was referring to is buying into a stock without a knowledge of fundamentals. Those two statements are worlds apart.
Secondly I have a reasonably good understanding of trading and am not looking at it with a blinkered view. I am well aware actually that the vast majority of people that trade any markets (90%) fail to make money. It is well known that many Wall Street traders make a loss for the first few years and a trader who can make a 30% average profit a year is considered world class.
Have a look at the BRW rich list in Australia or the Forbes list in the US. How many people do you see on there that made their money from trading (OK some may have used the skills to benefit their investing sure) but most are there because of a great business.
What Warren Buffet does is not complicated. He buys the best long term businesses when they are cheap. Coke, Gillette, American Express, Nike etc. Have a look at the Berkshire list. You have heard of most of them. It is not rocket science.
Lets look at the facts. I think it would be safe to assume that we are all looking for a good return on the markets - correct. We all want a better than average return, otherwise we would buy an index fund.
Buffet made 24% a year over his career to date. If you had just purchase a selection of the best ASX businesses (BHP, RIO, QBE, CSL, COH etc. Warren Buffet style) ten years ago when the dot com bubble popped and topped up along the way - perhaps selling out at the top of 2007 and then buying back in - you would be on close to a 20% profit compounding. That is easy money, and if you didn't sell no cap gains tax.
My point is to make trading work you have to produce returns close to 30% a year, year in year out to beat these kind of returns. I am sure you will admit that is a whole lot of work. Also, it gets ALOT harder the more money you have - perhaps why you don't see so many on the rich lists?
I digress, but that is why I am INVESTED in CCC. It is a great business prospect that I think will return well in excess of 30% over the next few years. Get a few of these right based on fundamentals and it doesn't matter what happens this week or next week.
Anyway, the trading information is useful for helping find entry points in the short term but in the long term the fundamentals win.
Good luck.
CCC Price at posting:
75.0¢ Sentiment: Buy Disclosure: Held
