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The 8% claim is misleading and possibly harmful. Nobody wants returns to be that "lumpy" - down for 10 years! Who could stand it? All investments have a certai
by chipsy 16y ago
The 8% claim is misleading and possibly harmful. Nobody wants returns to be that "lumpy" - down for 10 years! Who could stand it?
All investments have a certain lifespan on them - with things like bonds and T-bills, interest payments and maturity are fixed and contractually obligated, while with equities it's up to company performance. To really do well, you have to think like a trader and run all investments over a specific timeframe with predetermined exit signals for profit, loss, or trend changes.
It may look as if Warren Buffett lets money sit in the market. But he is actually running trades over decades of time. He has to - he literally has too much money to make useful(percentage-wise) profit in smaller time frames.
- carbocation 16y agoI agree that the 8% number is, at once, misleading, harmful, and true! True because it is a simple observation, but misleading because people behave as though the future recapitulates the past, of which there is no guarantee. I think that the "misleading and harmful" part is more important--which was the crux of my original comment about the lack of consistency.