South Korean boy with 43% gains is new retail trading icon(reuters.com)
reuters.com
South Korean boy with 43% gains is new retail trading icon
https://www.reuters.com/article/us-retail-trading-southkorea-student-inv-idUSKBN2A90YL
11 comments
With today's stock market even a cat can choose a portfolio and make 43% gains. At some point the music will stop, the big funds will dump the stocks and the retailers will hold the bag.
I think you misunderstand his investment philosophy.
He's a budding value investor and his role model is Warren Buffett which means he's buying undervalued stocks that have good fundamentals.
One of the companies he says he bought is Samsung. And while there may be a correction in the future, it's self evident that Samsung is a legit company with strong fundamentals.
Also he said in the article that he's investing long term: “Rather than short-term focused day trading, I want to keep my investment for 10 to 20 years with a long-term perspective, hopefully to maximize my returns.”
Value investors and students of Warren Buffett know that part of investing this way means you need the equanimity and tenacity to weather any short term volatility.
He's a budding value investor and his role model is Warren Buffett which means he's buying undervalued stocks that have good fundamentals.
One of the companies he says he bought is Samsung. And while there may be a correction in the future, it's self evident that Samsung is a legit company with strong fundamentals.
Also he said in the article that he's investing long term: “Rather than short-term focused day trading, I want to keep my investment for 10 to 20 years with a long-term perspective, hopefully to maximize my returns.”
Value investors and students of Warren Buffett know that part of investing this way means you need the equanimity and tenacity to weather any short term volatility.
Warren would tell him to stay away from Samsung. Not that it’s particularly overpriced, just that the kids portfolio size opens up enormous markets where far higher return investments lurk.
When WEB started, he worked the pink sheets and small cais because he could, he was only managing a few million at the start.
He seldom went into mid or large CEOs because they tend to be much more efficiently priced. You can see the results of his narrowing pool of opportunities as his portfolio grew over the decades. He has learned more and gotten better over time, yet his 40% returns in the 50s and 60s melt into the 25% returns of the 70s/80s, and thence to 15% returns in the 2000s.
Work at it kid, turn over every rock and read a dozen financial reports a day, and don’t settle for less than 100% annualized while your portfolio is under $1M.
When WEB started, he worked the pink sheets and small cais because he could, he was only managing a few million at the start.
He seldom went into mid or large CEOs because they tend to be much more efficiently priced. You can see the results of his narrowing pool of opportunities as his portfolio grew over the decades. He has learned more and gotten better over time, yet his 40% returns in the 50s and 60s melt into the 25% returns of the 70s/80s, and thence to 15% returns in the 2000s.
Work at it kid, turn over every rock and read a dozen financial reports a day, and don’t settle for less than 100% annualized while your portfolio is under $1M.
I seem to recall having read a very recent (couple years?) interview with him, where he was asked if value still worked nowadays. He said that if he only had 1 million to invest, he could still do 50% a year.
Well, the issue is that after the bubble pops he will have to wait 20 years anyway to reach today's value. I fail to see how Samsung stock is undervalued.
That has historically not been the case ever.
This is said by people in a self congratulatory way, who parrot bad advice as some deep truth, but even the most cursory glance at any long term market data shows with zero doubt that you are dead wrong, not only regarding many markets around the world, but also American markets
Here's the 100 year dow chart: https://tradingeconomics.com/united-states/stock-market
In July 1929 it peaked around 380. That level would not be reached again in nominal terms until the mid 50s. But there was also a lot of inflation in the 40's, so not only were you losing money, that money was losing value. So you lost in nominal terms and got devastated in real terms over 25 years.
Now let's look at Sep of 65. The dow is at 980. It won't recover that level until 83. Again including the inflation of the 70's. Stocks got destroyed in real terms over that 18 year period.
And many many stock markets around the world have uglier periods than that. Also many forecasters expect the 2020's to have some of the worst equity returns in modern history.
So as I said, unequivocally this is a false idea.
Here's the 100 year dow chart: https://tradingeconomics.com/united-states/stock-market
In July 1929 it peaked around 380. That level would not be reached again in nominal terms until the mid 50s. But there was also a lot of inflation in the 40's, so not only were you losing money, that money was losing value. So you lost in nominal terms and got devastated in real terms over 25 years.
Now let's look at Sep of 65. The dow is at 980. It won't recover that level until 83. Again including the inflation of the 70's. Stocks got destroyed in real terms over that 18 year period.
And many many stock markets around the world have uglier periods than that. Also many forecasters expect the 2020's to have some of the worst equity returns in modern history.
So as I said, unequivocally this is a false idea.
You’re not factoring in dividends. Dividends are a crucial component of returns of indices.
Someone who bought the market at its peak in March 2000 has earned a 6% compounded return since then.
You're talking to someone who has absolutely no clue what he's talking about.