You know we agree on a lot of things, but I’m not sure many investors go long or buy and hold in the commodities markets.If you are trading in and out and it drops to $100, you will lose everything. If you’re trading in and out and miss a run up, you’re gaining nothing. If you’re shorting and price rises significantly, your losses are potentially unlimited. If you think you can get the ups and downs right most of the time, you’re wrong. Virtually no one can. Those who report their big trading gains tend to ignore their big losses. They leave that part out of their “proven trading strategy for getting rich quick” systems.
I don’t play any of those games. I invest for the long term in companies or projects I believe in. And the best way to save for the long term is to dollar cost average. Take a look at independent studies on the technique, the reduction of risk is greater than the slight loss of potential gains you would have if you were lucky enough to buy right at the bottom.
Plenty of money had been lost by timers and traders who think they can outwit the market. Before anyone decides to short term trade any asset, they should ask themself one question: How and in what ways am I smarter than all the others who’ve tried this and failed? OK two questions: If it’s that easy to get rich, why isn’t everyone driving Ferrari’s?
The richest people in the world got there by investing gradually over time, whether in stocks, real estate or even commodities.
It’s more like when Billy Ray and Louis took down the Duke brothers in the frozen OJ markets.