stocks

When I was working as a financial advisor I stayed away from individual stocks for a number of reasons but the most important was that stocks did not seem to rise and fall based on any logical reason. The one example that stands out in my mind was silver. I knew early on that digital cameras would not need silver to process film and I knew that the biggest use of silver was in film processing. Logic told me to sell silver short as the price would decline as demand declined. Even though the use of silver in films declined to almost nothing the price of silver rose and this happened with in a 15 year span. While all of this change is taking place Kodak and Polaroid file for bankruptcy but silver use just kept growing. Amazon came out in 1994 and everyone thought this would be a winner but they didn’t make a profit until 2001 and then they paid one cent per share. Many people who bought early did not hold on and missed out on the big run up later. It is not only what to buy but how long to hold. I found the market was much like people who go to the casino. They tell you about the winning but not about the losing. In the market the spectacular winners get the publicity so others try to pick the next big winner.