The Logic of Investing

Sep 14
07:46

2007

Damian Papworth

Damian Papworth

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One of the things I have noticed during the 20 years I have spent either actively investing in various strategies,or trialling them, is that the ones which make logical sense usually are the ones which work best in real life.

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Lets face it,The Logic of Investing Articles you could spend 2 life times trialling all the investment strategies people offer you.  There are somany out there, and I am sure most of them have merit. WhatI have found though (and this in no way passes judgement onthe merits of any investment strategy) is that if I reallythink logically about many of the investment strategieswhich have come my way, there often are holes in them... big ones at that too.

Its quite possible that these strategies, in their wholeness work quite well.  But the problem is that if you are trading a strategy which has holes in the logic, at some stage you'll come up against a real life situation where the strategy has no answer.  Then you'll be on your own and you'll need to make a decision. 

When I am in this situation, where I have to make a decision about a strategy I am trading, because the strategydoes not offer me guidance, I believe I am gambling.  Thisis not good.  I may make the right decision, but then again, I may lose my money. In all good investment strategies, you should not have to do this.  You should simply plan the trade, and then trade the plan.  There should not be room for guess work.

At TheOnlyWay.com.au, we have found 2 investmentstrategies, the logic of which is as close to flawless as youare likely to find.  This is why we like these strategies,this is why we trade these strategies successfully, and this is why we recommend these strategies.  Here is a summary of what they offer:

Foreign Exchange Trading: Our FX Trading Strategy can be summarised by the following points:

  • Our holdings are always counter-active.  Therefore, our overall position is insulated against short term adverseswings in the market, in any particular currency.
  • We admit to not knowing for sure, whether our currencieswill go up or down, so we set our trades to take advantage of both directional swings
  • We ensure we make large positive interest income on ourpositions, everytime we enter the market, on our entireleveraged holdings.  This is additional income to our trading proifits.

Click here for some more detail on our Foreign Exchange Trading Strategy:

Stock Market Trading

  • We choose only the top 150 companies in the stock market,as these tend to be the more safe and stable companies.
  • Every month, we place a trade which will pay us some additional cash, just because we own those stocks (No, thiscash is not a dividend payment, and it happens monthly)
  • As we get paid this cash, per stock we own, every month,we actually reduce the risk of our holding, while earningmore money (Ie. if we buy some stocks at $20.00, and getpaid $0.50 per share in the first month, we have a lowerrisk on this blue chip stock as our "break even" point isnow $19.50.

Here is some more detail on our Stock Market Trading Strategy

Remember, at TheOnlyWay.com.au, we are actively trading these strategies today.  Its all in our promise to you which is detailed here: Our Promise To You

So if you have any real life questions about these strategies, or any other on our website, contact us today.