Money day! Missed these?

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There are numerous ways to make money. Investing is one worth trying. There are types of investors and investments, but there are always the ones anyone can get into.

Becoming an Investor, let's go!

"All of human unhappiness comes from one single thing: not knowing how to remain at rest in a room." – Blaise Pascal.

Core principles:

A stock is just a ticker symbol or an electronic blip; it is an ownership interest in an actual business with an underlying value that does not depend on its share price.

The market is a pendulum that forever swings between unsustainable optimism (which makes stocks too expensive) and unjustified pessimism (which makes them too cheap).

The intelligent investor is a realist who sells to optimists and buys from pessimists.

The future value of every investment is a function of its present price. The higher the price you pay, the lower your return will be.

No matter how careful you are, the one risk no investor can ever eliminate is the risk of being wrong. You can minimize your odds of error by insisting on a margin of safety(never overpaying, no matter how exciting an investment seems to be).

The secret to your financial success is inside yourself. Become a critical thinker who takes no Wall Street "fact" on faith, and you invest with patient confidence. You can take steady advantage of even the worst bear markets. 

By developing your discipline and courage, you can refuse to let other people's mood swings govern your financial destiny.

Ultimately, how your investments behave is much less important than how you behave.

-> Do you have experience investing? 

We all need it, just start small to see how you behave.

Kinds of investors:

There are 2 main types of investors: the defensive investor and the enterprising investor.

The defensive (or passive) investor will emphasize avoiding severe mistakes or losses. His second aim will be freedom from effort, annoyance, and the need for frequent decisions.

The determining trait of the enterprising (or active or aggressive) investor is his willingness to devote time and care to selecting securities that are both sound and more attractive than the average. 

It has long been the prevalent view that the art of successful investments lies first in choosing the industries that are most likely to grow in the future and then in identifying the most promising companies in these industries.

Both styles of investors get returns. It's a personal choice.

-> Can you identify which type you are? 

This is connected with your personality.

Defensive investor:

The selection of common stocks for the defensive investor's portfolio should be a relatively simple matter. Here, we would suggest four rules:

1.There should be adequate, though reasonable, diversification. This might mean a minimum of ten issues and a maximum of thirty.

2.Each company selected should be large, prominent, and conservatively financed. Indefinite as these adjectives must be, their general sense is clear. 

3.Each company should have a long record of continuous dividend payments. 

4.The investor should limit the price they will pay for an issue concerning their average earnings over the past few years. 

Growth stocks are too uncertain and risky a vehicle for the defensive investor. But you decide.

Portfolio changes: It is now standard practice to submit all security lists for periodic inspection to determine whether their quality can be improved. Incidentally, suppose the list has been competently selected in the first place. In that case, there should be no need for frequent or numerous changes. 

-> The clock is ticking... 

You don't need to start with a billion-dollar portfolio but start.

Aggressive investor:

Growth stocks are too uncertain, and a risky vehicle for the aggressive investor should start from the same base as the defensive investor: dividing his funds between high-grade bonds and high-grade common stocks bought at reasonable prices.

He will prepare to branch out into other kinds of security commitments when there is well-reasoned justification. The field of choice is wide. Selection should depend not only on the individual's competence and equipment but also on his interests and preferences.

The advice of Benjamin Graham for the best kind of opportunities for the aggressive investor:

1.Tax-free New Housing Authority bonds effectively guaranteed by the United States government.

2.Taxable but high-yielding New Community bonds, also guaranteed by the United States Government.

3.Tax-free industrial bonds issued by municipalities but serviced by lease payments made by solid corporations.

Lower-quality bonds may be obtainable at such low prices as to constitute true bargain opportunities. But these would belong in the "special situation" area, where no true distinction exists between bonds and common stocks.

-> Does this sound a little more like you? Being an aggressive investor is not for everyone, but it can give you opportunities that a defensive investor will not even see.

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Last thoughts:

Once you realize you can ignore the noise without the world ending, you gain a unique kind of freedom. Without attention, you have no time. Time without attention is meaningless, so prioritize attention over time.

The Intelligent Investor by Benjamin Graham is a book about investments and their history. It teaches us a lot about the market's "patterns" and why things go wrong or right from time to time. 

ProfitZine advises you to read it, but this one is massive and difficult to digest, so we decided to make a summary of the part about being an investor that you can control.

"You can get ripped off easier by a dude with a pen than you can by a dude with a gun" – Bo Diddley.

-> No matter what type of investor you are or the type of investment you prefer.

Just become an investor, or inflation will win every time.

See you in a week.

Your Zine.