Stocks are crashing, so you turn on the television to catch the latest market news.
"Falling stock prices would be fabulous news for any investor with a very long horizon."
"You Ain't Seen Nothin' Yet."
It is to be expected that the price of a stock can goes down by a third and can goes up by a half, even in normal market situations.
In fact, when the market is being sold down, the long term value investor gets excited and enthused.
The risk is not in the price volatility.
•The risk is in oneself, reacting "stupidly" to price fluctuations.
•The other risk of course is making a wrong assessment of the future earnings and future earnings growth of the business of the company you bought.
http://myinvestingnotes.blogspot.com/2009/07/news-you-could-use.html
Investment Owner's Contract
http://myinvestingnotes.blogspot.com/2009/07/investment-owners.html
Market Price Fluctuations
http://myinvestingnotes.blogspot.com/2009/07/52w-hg-1.html
Showing posts with label investment owner's contract. Show all posts
Showing posts with label investment owner's contract. Show all posts
Thursday, 15 October 2009
Saturday, 1 August 2009
Investment Owner's Contract
I, ________, hereby state that I am an investor who is seeking to accumulate wealth for many years into the future.
I know that there will be times when I will be tempted to invest in stocks or bonds because they have gone (or "are going") up in price, and other times when I will be tempted to sell my investments because they have gone (or "are going") down.
I hereby declare my refusal to let a herd of strangers make my financial decisions for me. I further make a solemn commitment never to invest because the stock market has gone up, and never to sell because it has gone down. Instead, I will invest $ xxxx.00 per month, every month, through an automatic investment plan or "dollar-cost averaging program," into the following mutual fund(s) or diversified portfolio(s):
____________,
____________,
____________.
I will also invest additional amounts whenever I can afford to spare the cash (and can affort to lose it in the short run).
I hereby declare that I will hold each of these investments continually through at least the following date (which must be a minimum of 10 years after the date of this contract): __, ____, 20__. The only exceptions allowed under the terms of this contract are a sudden, pressing need for cash, like a health-care emergency or the loss of my job, or a planned expenditure like a housing down payment or a tuition bill.
I am, by signing below, stating my intention not only to abide by the terms of this contract, but to re-read this document whenever I am tempted to sell any of my investments.
This contract is valid only when signed by at least one witness, and must be kept in a safe place that is easily accessible for future reference.
Signed:
Date:
Witnesses:
1. The Sheep
2. The Cow
XXXXXXXXX
Isn't the above an interesting contract?
Ref: Intelligent Investor by Benjamin Graham
I know that there will be times when I will be tempted to invest in stocks or bonds because they have gone (or "are going") up in price, and other times when I will be tempted to sell my investments because they have gone (or "are going") down.
I hereby declare my refusal to let a herd of strangers make my financial decisions for me. I further make a solemn commitment never to invest because the stock market has gone up, and never to sell because it has gone down. Instead, I will invest $ xxxx.00 per month, every month, through an automatic investment plan or "dollar-cost averaging program," into the following mutual fund(s) or diversified portfolio(s):
____________,
____________,
____________.
I will also invest additional amounts whenever I can afford to spare the cash (and can affort to lose it in the short run).
I hereby declare that I will hold each of these investments continually through at least the following date (which must be a minimum of 10 years after the date of this contract): __, ____, 20__. The only exceptions allowed under the terms of this contract are a sudden, pressing need for cash, like a health-care emergency or the loss of my job, or a planned expenditure like a housing down payment or a tuition bill.
I am, by signing below, stating my intention not only to abide by the terms of this contract, but to re-read this document whenever I am tempted to sell any of my investments.
This contract is valid only when signed by at least one witness, and must be kept in a safe place that is easily accessible for future reference.
Signed:
Date:
Witnesses:
1. The Sheep
2. The Cow
XXXXXXXXX
Isn't the above an interesting contract?
Ref: Intelligent Investor by Benjamin Graham
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