Online Investing
- Continued"...
The
keys to making your online investment program work for you - and not
leave you constantly pulling your hair out - is to understand how market
forces interact to create an investment outcome.
Professional
investors (the lords of Wall Street) are not as concerned with a given
company's fortunes one way or another; their approach is to try and
guesstimate what the market psychology will create in terms of
predicting the average market response to the sum total of events that
could theoretically impact the market and a given industry group (or
sector) within the market. Obviously, this is easier said than
done and is subject to all sorts of economic theories. The end
result is a market that requires constantly diligence in order to
predict with any degree of certainty.
What
does that mean to you?
Investing
for capital appreciation appears to be the only solution that Wall
Street would prefer to offer. Investing for the sake of acquiring
a future stream of income from the investment is a very distant second.
That
must mean the only logical play in the public stock markets are for
investors seeking long-term appreciation, as the long-term outlook would
even out the bumps and potholes along the way, while your investment
grows.
Rainmaker
advocates a different position. We believe the net profit
generated by a company is the property of its shareholders (which is
legally true) and is not for management to reinvest at its own
discretion. Companies that are good stewards of the shareholder's
interest will always rise to the top while those that are determined to
reinvest shareholder funds sound a lot like a den of thieves.