Hi Herc;
I think you are missing the essential points; you are right in part
like getting the frame right but forgetting the picture.
He is making a few very simple clear points...
1/ Investing for the Long Term
Individuals need to see that investing is not like placing a bet on number 32 on the roulette wheel, but instead it's buying a tangible piece of a business.
It is absolutely important to understand the relative price you are paying for that business,
but what isn't important is attempting to understand whether you're buying in at the "right time," as that is so often just an arbitrary imagination.
In Buffett's own words,
"if you're right about the business, you'll make a lot of money," so don't bother about attempting to buy stocks based on how their stock charts have looked over the past 200 days. Instead always remember that
"it's far better to buy a wonderful company at a fair price."
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I think it is important to not lose focus on the essential points and principles of Buffets advice. It is a different question of whether or not MRF is one of these long term gems.
2/ The Dangers of Timing
Yet as Buffett has noted continually, it's terribly dangerous to attempt to time the market:
"With a wonderful business, you can figure out what will happen; you can't figure out when it will happen. You don't want to focus on when, you want to focus on what. If you're right about what, you don't have to worry about when"
So often investors are told they must attempt to time the market, and begin investing when the market is on the rise, and sell when the market is falling.
This type of technical analysis of watching stock movements and buying based on how the prices fluctuate over 200-day moving averages or other seemingly arbitrary fluctuations often receives a lot of media attention, but it has been proved to simply be no better than random chance. (I think this is one of the KEY POINTS - Lets focus on this for a bit
)
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3/ Patience Pays
This point is a neglected point but a powerful point; through all sorts of markets Value emerges and triumphs. In my opinion many investors do not even know what compounding is .... Let alone Value.
I know that $40 in 1919 is very different from $40 today. However, even after factoring for inflation, it turns out to be $540 in today's money. Put differently, would you rather have an Xbox One, or almost $11 million?
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These points do apply to MRF in my opinion. That of course is a massive post waiting to happen. MRF is the Coke A Cola of SL Vein Graphite. The Key Investment Drivers are all built on What not WHEN in my opinion.
What NOT When!
Kind Regards
DYOR !!!!!
