Sublime

Day trading and picking individual stocks is not rational for most investors—the odds are heavily against your success. But they’re both reasonable in small amounts if they scratch an itch hard enough to leave the rest of your more diversified investments alone.

Ronald Read was patient; Richard Fuscone was greedy. That’s all it took to eclipse the massive education and experience gap between the two.

A fantastic story about the father of modern portfolio theory, Harry Markowitz, brings this to life. Markowitz considered the optimal mix of assets for his personal portfolio but found it all too complicated to wrap his prodigious brain around. “I should have computed the historical co-variances of the asset classes and drawn an efficient frontier,

If he is to pay some special attention to the selection of his portfolio, it might be best for him to concentrate on issues selling at a reasonably close approximation to their tangible-asset value—say, at not more than one-third above that figure.

An investor without discipline is not an investor—he’s a gambler.

The activities specially characteristic of the enterprising investor in the common-stock field may be classified under four heads: Buying in low markets and selling in high markets Buying carefully chosen “growth stocks” Buying bargain issues of various types Buying into “special situations”

Lynch’s most important tool was his telephone, not his computer. He’d regularly call, or sometimes visit, a network of well-placed executives, asking for updates on their businesses, competitors, suppliers, customers, and more. These were legal tactics at the time, even though smaller investors couldn’t access the same information.