Wednesday, February 16, 2011

Long-Term in Investments

Yesterday, tuesday 15, Infomoney, a supposed news investing site, announced that USA future market was lower because of indicators disap­pointments.
Bolsas dos EUA em baixa, pressionadas por decepção com indicadores

Today, the same site says that now USA future market advances exactly for the opposite reason: good indicators!
Bolsas dos EUA avançam com olhares voltados para indicadores e resultados


That's ridiculous! It's obviously not a way an intelligent investor should behave. Graham counsels investors to resist putting any importance on the day-to-day swings in market prices and favors buying stocks as you would a business, for their true intrinsic value.

Pay attention to what says Buffet:
I don't want to buy any stock where if they close the New York Stock Exchange tomorrow for five years I won't be happy owning it. I buy a farm and I don't get a quote on it for five years and I'm happy if the farm does ok. I buy an apartment house, don't get a quote on it for five years - I'm happy if the apartment house produces the returns that I expect. But people buy a stock and they look at the price the next morning and they decide if they're doing well or not doing well. It's crazy because they're buying a piece of a business.

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