If Vulcans were investors they would:
- Buy from Vanguard. (It’s the most logical choice)
- Buy no-load funds with low expense ratios.
- Do their investing homework before buying anything.
- Study historical market data (50, 100, 200+ years worth).
- Observe but detach from market sentiments.
- Invest for the long run.
- Read the fine print.
- Just say “No” to stock pushers, brokers, and middlemen.
- Do their own research.
- Make their own decisions.
- Analyze the outcome of their decisions and learn.
My goal is to be a Vulcan investor. Naturally that is not entirely possible, however, I believe I come reasonably close. I save. I read the fine print. I say “No” to investing solicitations. I do my own research. I avoid loads and seek out low fees and expense ratios. I invest for the long run.
I acknowledge my emotion. I find outlets for it to leave my investing mind cool, logical, creative, and rigorous. One outlet is the Crazy Ivan Account (CIA). Using CIA play money releases my pent up investing emotions. Another outlet is occasional gambling. Why recklessly gamble big money on the stock/bond/options/futures markets when it is relatively easy to gamble small money at the casino and get free drinks to boot? A $200 or $300 bank roll tends to last quite a while at a $5 craps table, often for several hours, if the “bad bets” (bigger house advantage) are avoided.
I say the object of gambling is to gamble… To be irrational, even superstitious, and above all to have fun. Whereas the object of investing is to maximize return and minimize risk. Fun, generally speaking, should have little to do with investing. All things equal, I believe that the best investments tend to be boring. Accounting, and tax planning are also best when boring. Enron accounting might have been exciting… but it was also disastrous. The CIA allows me to bend this rule in a limited way, allowing my non-Vulcan desire for fun and impulsive investing to be contained.
I’m not a exactly a Vulcan investor, but I try to act like one. Are you a Vulcan investor? Do you want to be? Please share your thoughts by commenting on this post. Its easy. I look forward to hearing from you.