Business bookshelves overfl ow with titles promising formulas for
success in the stock market. It makes one wonder why everyone is
not yet wealthy. Could it be that there is no magic formula? Could it
be that investing well requires talent, education, and hard work?
Unfortunately, the answer is yes, no, and maybe. You may be able
to work many hours of each day, but your money and your ideas can
work 24 hours a day, 7 days a week, and they should. Wealth accrues
to people who know how to make money while they read, watch
television, eat, drink, work, and yes, even while they sleep. Investing
through the stock market is one way to do this, and it is our passion
and our business.
When people ask whether we believe investing is an art or a science,
they usually intend art and science to represent “intuition” and
“knowledge,” respectively. So the real question is this: If we studied
hard enough and executed the formula precisely, could we always
make profi table choices? Or does investing require high levels of talent,
sensitivity, and intuition, such that only a gifted few can prosper?
These questions have little to do with entrepreneurial investing,
but since many authors and fi nancial advisers propagate the illusion
that investing is a science, the subject merits further discussion. Let
us begin by stating plainly that investing is not a science, although
investors should behave like scientists. Further, investing is not an
art per se, but certain artistic sensibilities improve one’s chance of
success. In fact, the traits common to artists and scientists also help
investors: keen observation, active imagination, courage to experiment,
and openness to change.
success in the stock market. It makes one wonder why everyone is
not yet wealthy. Could it be that there is no magic formula? Could it
be that investing well requires talent, education, and hard work?
Unfortunately, the answer is yes, no, and maybe. You may be able
to work many hours of each day, but your money and your ideas can
work 24 hours a day, 7 days a week, and they should. Wealth accrues
to people who know how to make money while they read, watch
television, eat, drink, work, and yes, even while they sleep. Investing
through the stock market is one way to do this, and it is our passion
and our business.
When people ask whether we believe investing is an art or a science,
they usually intend art and science to represent “intuition” and
“knowledge,” respectively. So the real question is this: If we studied
hard enough and executed the formula precisely, could we always
make profi table choices? Or does investing require high levels of talent,
sensitivity, and intuition, such that only a gifted few can prosper?
These questions have little to do with entrepreneurial investing,
but since many authors and fi nancial advisers propagate the illusion
that investing is a science, the subject merits further discussion. Let
us begin by stating plainly that investing is not a science, although
investors should behave like scientists. Further, investing is not an
art per se, but certain artistic sensibilities improve one’s chance of
success. In fact, the traits common to artists and scientists also help
investors: keen observation, active imagination, courage to experiment,
and openness to change.
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