Ladies and gentlemen, I have the secrets to making money in the stock market, and I’m here today to share them with you. The process is very simple, but does require time and effort. You can do this if you follow my simple guide.
Step 1: Go to school. You need to get a good degree from a good school that prepares you for a life of high finance and chumming with the captains of industry.
Step 2: Start working with a reputable company that gives you good experience in the normal work life.
Step 3: Go back to School. After a few years of working somewhere in business you need to go get an advanced degree. And I’m not talking about a Master of Fine Arts in history. Here’s a list of the schools attended by the richest investors in the country: Penn, Columbia, London School of Economics, Harvard, Princeton, NYU, MIT, and Berkeley. Most of these people have MBAs from the business schools at these institutions, and one sports a PhD as well.
Step 4: Convert to Judaism. Don’t ask me why, but I’ve talked about this before. For whatever reason, it helps.
Step 5: Get a job at a top financial institution. Step 5 is really big because it’s going to put you in the state of mind you need to be in to successfully invest in the stock market. The most successful investors devote 40-80 hours a week evaluating companies. They screen thousands of stocks looking for the right match. They read news on the companies, comb through financial reports, and even speak to employees and managers of the firms.
Step 6: Strike out on your own. Now you’re ready to start making your own money. Do exactly what you were doing before, spend 60 hours a week combing through stock reports and making smart investments. Constantly watch CNBC, stress about the slightest move in the market, and carefully decide when to buy, sell and hold. You’ll find it hard to take a vacation because your whole year’s worth of earnings could be wiped out in a week.
Step 7: Take huge risks. The greater the risk, the greater the (potential) reward. The guys worth the big bucks have made huge bets.
Step 8: Get lucky and make lots of money. Honestly, half of your success in the market is pure luck, which is why so few people do it consistently (probability theory demands a few people regularly make the right investments).
Step 9: Pay taxes. If you trade on a regular basis, good luck with that.
Step 10: Go back to Step 6.
OK, so maybe it isn’t a secret and it’s definitely not easy. You might could skip the first 4 or 5 steps, but if you want to get into the billions you’ll need them. You could just become a part-time trader and work full-time elsewhere. But no one has heard of anyone that regularly makes decent money part time. Making money in the stock market is a full time job.
The unfortunate thing about the situation is that for every Warren Buffett or John Paulson out there, there’s 10 guys just like them that have failed miserably. They went to the same schools, maybe even at the same time. They did all the right stuff but just made the wrong bets. Why? Again, luck may be a big part. So how do you really make money in the stock market?
Photo: David Prior
 By The Weakonomist |
The Weakonomist is the founder of Weakonomics. Clicking the picture of the puppy will tell you more about him. If you like what you're reading consider subscribing to the blog, following him on Twitter, and checking out the related posts below. Please consider a donation if you really enjoy Weakonomics. Also keep in mind that nothing I say can be construed as financial advice. |
Pingback: SM-frugality-and-saving-money | NoelInfoServices.com