Gazing down at 50,000 feet, the cities blur. Detail is lost to broad sweeping landscape. Geographical features clear enough, but what of the sticks & stones, flora & fauna?
There are certain truths to finance and investing that must never be lost-sight-of or disrespected.
This marketplace is not a casino. A weighing machine perhaps. A mechanism for commerce, certainly. These corporations are not merely stock-tickers flipping themselves up and down. These are living breathing entities, with vision, innovation, trials, tribulations and life spans to each their own.
Which brings me to my next point. Real Companies Survive.
I’m not talking about flash-in-the pan momentum movers, story stocks or seedy message board pump-and-dumps. I’m talking about companies with cash-flow, EBITDA, Net Income. I’m talking about operational-excellence and societal advancement. I’m talking about investments that pay dividends. Those whose equity represents a genuine asset.
There are No Shortcuts in finance.
Easy-money is a dangerous myth. Fast-Money exists, but by its very nature it’s come-and-go.
Wealth is earned, accumulated: Methodically. Through focus, patience, and discipline. You must put in the work to reap the rewards and there is no escaping the risk-reward paradigm.
Diversification is the most important tool in finance. This is because diversification unequivocally and mathematically reduces risk.
That said, the one advantage given is time. What you do with it is up to you.