The recent volatility we have been witnessing in the financial markets and some of the many large corrections certain sectors and companies have taken have kept our account repair department very busy as of late. Many do-it-yourself investors have taken a ferocious beating over the past few months as most of the dot com companies have been lingering in quicksand. There is a major difference between building a portfolio and day trading. We at Markowski Investments do an extraordinary amount of homework.
OUR BOTTOM LINE!
We get comfortable with our companies. The typical daytrade/online investor surfs the web looking for that next wave. The credo of the online investor is to trade in the unproven dot com companies. Buy into strength, and sell into weakness. The online trader does not get comfortable with the companies he or she owns because usually they are sold by the bell.
THE BOTTOM LINE FOR ONLINE INVESTORS.
Last year over 95% of online investors lost money. With those odds, it is a wonder why so many new people start everyday. We at Markowski Investments are still trying to figure out how and why so many people are attracted to such a losing proposition.
In all our years of managing money, one thing we know for sure, trying to pick the direction of stocks for a point or two is about as certain as picking either red or black on a roulette wheel. Even the “Rain Man” got that one wrong. Sudden irrational movements, trade imbalances, the weather, and so on and so forth make point to point movements impossible to forecast. The most recent report from the Trading Project Group of the North American Securities Administrators Association showed conclusively that the majority of people attempting to trade lose “EVERYTHING THEY INVEST.” Forbes magazine makes a unique comparison stating,
“Trading online is like casino gambling. Both involve bets on random moves that come with heavy tariffs and ensure that it is the rare gambler who can beat the house over time.”
Over Time… Online Traders Go Broke.