Friday, July 31, 2009

From the Mouth of a Babe

Today I attempted to explain to my son what I do for a living. In short, I invest in companies. Showing him a list of companies that I owned, he pointed to one that was highlighted on the page and asked why. I explained that it was one I sold.

His response: "Daddy, why did you fire yourself on that one?"

Hmmm... Why did I fire myself?

Reminds me of the following Ben Graham quote:
"The true investor scarcely ever is forced to sell his shares, and at all times he is free to disregard the current price quotation. He need pay attention to it and act upon it only to the extent that it suits his book, and no more. Thus the investor who permits himself to be stampeded or unduly worried by unjustified market declines in his holdings is perversely transforming his basic advantage into a basic disadvantage. That man would be better off if his stocks had no market quotation at all, for he would then be spared the mental anguish caused him by other persons' mistakes of judgment."
How do I explain this to a 5 year old?

Daddy is a damned speculator!

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