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    How to Make More Money By Sitting on Your Butt: and Other Contrarian Conclusions From a Lifetime in the Markets
    How to Make More Money By Sitting on Your Butt: and Other Contrarian Conclusions From a Lifetime in the Markets
    How to Make More Money By Sitting on Your Butt: and Other Contrarian Conclusions From a Lifetime in the Markets
    Ebook135 pages2 hours

    How to Make More Money By Sitting on Your Butt: and Other Contrarian Conclusions From a Lifetime in the Markets

    By Mark Tier

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    About this ebook

    Can you really make more money by just sitting on your butt?

    You bet you can.

    Indeed, if you're not a “butt-sitting” investor some of the time, you've increased your chances of losing money in the markets.

    As legendary trader Jesse Livermore put it: “It was never my thinking that made the big money for me, it always was sitting.”

    And George Soros: “When there’s nothing to do, do nothing.”

    And Warren Buffett spends most of his time “sitting on his butt”—reading annual reports.

    How you can make more money by just sitting on your butt is just one of the many "contrarian conclusions" you'll find in this free eBook.

    Conclusions I've usually come to the hard way: by losing money or missing out on a slam dunk opportunity.

    You’ll find some others in this “mini”-book, including—

    —Why diversification is one of the “7 Deadly Investment Sins”
    —​How to avoid getting suckered by a stock’s “sizzle”—and focus on the steak (if there is any!)
    —Why, if there are any shortcuts to wealth, the much-touted “theory of contrary opinion” isn’t one of them

    Save yourself an expensive education by getting your copy of How to Make More Money By Sitting on Your Butt now.

    Happy (and profitable!) reading.

    LanguageEnglish
    PublisherMark Tier
    Release dateJan 3, 2017
    ISBN9789889776992
    How to Make More Money By Sitting on Your Butt: and Other Contrarian Conclusions From a Lifetime in the Markets
    Author

    Mark Tier

    Mark Tier is an Australian writer and businessman who has lived and worked in Hong Kong since 1977. He has been a marketing consultant and counselor, and has helped start up five new investment publications. He graduated from the Australian National University with a degree in economics and is pursuing his Ph.D. in economics through UCLA. Mark is the author of The Winning Investment Habits of Warren Buffett & George Soros.

    Read more from Mark Tier

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      Book preview

      How to Make More Money By Sitting on Your Butt - Mark Tier

      Table of Contents

      INTRODUCTION: Can you really make more money by just sitting on your butt?

      7 Contrarian Investment Tips From the World’s Richest Investors

      How To Make More Money By Sitting on Your Butt

      A Good Story—but a Good Investment?

      Your Profit is Virtually Guaranteed

      Using Scuttlebutt to Maximize Your Profits

      Windfall Profits

      Contrary to Contrary Opinion

      Why Diversification is one of the Seven Deadly Investment Sins

      The Accountant’s Investment Edge

      What’s Your Investment Style?

      About the Author

      Preview The Winning Investment Habits of Warren Buffett & George Soros

      Chapter 1: The Power of Mental Habits

      Why Johnny Can’t Spell

      The Structure of Mental Habits

      IceBreakers

      Chapter 2: The Seven Deadly Investment Sins

      Chapter 4: George Soros Doesn't Take Risks?

      Risk is Contextual

      Unconscious Competence

      The Four Stages of Learning

      Risk is Measurable

      What Are You Measuring?

      Investment Criteria

      Risk is Manageable

      1. Don't Invest

      2. Reduce Risk

      3. Actively Managing Risk

      Beating a Hasty Retreat

      Emotional Disconnect

      I Am Fallible

      4. Manage Risk Actuarially

      Gambling, Investing, and Risk

      Actuarial Investing

      Risk versus Reward

      Chapter 26: Do You Need to be a Genius?

      Chapter 31: It's Easier Than You Think

      Other Titles by Mark Tier

      How to Make More Money

      By Sitting on Your Butt

      and other contrarian
      conclusions from a lifetime
      in the markets

      Mark Tier

      INTRODUCTION:

      Can you really make more money by just sitting on your butt?

      You bet you can.

      Indeed, if you’re not a butt-sitting investor some of the time, you’ve increased your chances of losing money in the markets.

      Get your copy here.

      As legendary trader Jesse Livermore put it: It was never my thinking that made the big money for me, it always was sitting.

      And George Soros: When there’s nothing to do, do nothing.

      And Warren Buffett spends most of his time sitting on his butt—reading annual reports.

      This is just one of the many contrarian conclusions I’ve come to in the 42 years I’ve been in the investment marketplace. The following pages of this ebook cover ten different topics. And you can find others at my website, marktier.com.

      Most of these conclusions I’ve come to the hard way: by losing money or missing out on a slam dunk opportunity.

      All in all, an expensive, but ultimately profitable, education.

      Let’s begin with 7 contrarian investment tips from the world’s greatest investors . . .

      7 Contrarian Investment Tips From the World’s Richest Investors

      What great investors do that average investors don’t

      Warren Buffett and George Soros are the world’s richest investors. Their investment styles are as opposite as night and day. Buffett buys companies that he considers to be good bargains; Soros is famous for his speculative forays into the currency markets, which is how he came to be known as The Man Who Broke the Bank of England.

      But—as I have detailed in  The Winning Investments Habits of Warren Buffett & George Soros—they both practice the same 23 mental habits and strategies religiously. As do Carl Icahn, Sir John Templeton, Bernard Baruch, and all the other successful investors I’ve ever studied or worked. It doesn’t matter whether you buy stocks, short currencies, trade commodities, invest in real estate, or collect ancient manuscripts: adding these mental strategies to your investment armory will do wonders for your bank account. 

      To make it easy to get going, I’ve distilled these 23 mental habits into these seven simple (though not always easy to follow) rules:

      1. If you’re not certain about what you’re intending to do, don’t do it. Great investors are always certain about what they are doing whenever they put money on the table. If they think something is interesting but they’re not sure about it, they do more research—or just take a walk.

      So next time, before you call you broker (or go online), ask yourself: on a scale of 1 to 10, how certain am I that I will make money? Choose your own cut off point, but if it’s less than a 7 or an 8, you definitely need to spend more mental energy before making a commitment.

      A cold shower might be even a better investment.

      Remember: the great investor’s sense of certainty comes from his own experience and research. If your sense of certainty doesn’t come from your own research, it’s probably a chimera.

      2. Never take big risks.You probably heard that the only way to make big profits in the market is to take big risks. It’s simply not true.

      Warren Buffett, George Soros, Peter Lynch . . . they only invest when they are confident the risk of loss is very slight.

      Okay, what about that person you heard about who made a bundle of money in copper or pork belly futures or whatever by taking on enormous leverage and risk? 

      A few simple questions:

      Did he make any other big profits like that? 

      Did he do this last year as well, and the year before that, and the year before that?

      If not, chances are that’s the only big profit he ever made. 

      The great investors make money year in year out. And they do it by avoiding risk like the plague.

      3. Only ever buy bargains.This is another trait the great investors have in common: they’re like supermarket shoppers loading up on sale items at 50% off.

      Of course, the stock exchange doesn’t advertise when a company’s on sale. What’s more, if everybody thinks something is a bargain, the chances are it’s not (or if it is, it won’t be for very long!). 

      That’s how Benjamin Graham, author of the classic The Intelligent Investor, averaged 17% a year over several decades of investing. He scoured the stock market for what he considered to be bargains—companies selling under their break-up value—and bought nothing else. 

      Likewise, Warren Buffett. But his definition of a bargain is very different from Graham’s: he will only buy companies he can get at a discount to what he calls intrinsic value: the discounted present value of the company’s future earnings. They’re harder to identify than Graham-style bargains. But Buffett did better than Graham: 23.4% a year. 

      Even George Soros, when he shorted sterling in 1992, was convinced that the pound was so overvalued that there was only one way it could go: down. That’s a bargain of a different kind, but a bargain nonetheless.

      4. Do your own leg-work. How do they find investment bargains? Not in the daily paper: they might occasionally find a good investment idea there, but not any true bargains.

      The simple answer to How do they do it? is: on their own. After all, almost by definition, an investment is only a bargain if hardly anybody knows about it. As soon as the big players discover it, the price goes up. 

      So

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