Wednesday, September 7, 2011

Portfolio Management: 7- Hedging and Speculation

I take a slightly different viewpoint on hedging and speculating

EDIT: At the time this blog entry was posted I had a Youtube video here. That has been removed but I want the rest of my content to be remain. Nothing hidden no past mistakes ignored. All out in the open.

Ok so we all hedge and we all speculate. Now that we got that out of the way lets tackle the differences between hedge fund managers and people.
They have more money to work with.
That's about it. Seriously.

Think when you first started your current job. There was lots of things new. Other people were doing things and their jobs that you had no idea how to do. With time and experience the mystery of how they do it was cleared up and you learned the tricks of the trade for your job. Then you see the new person hired and they make the mistakes that you know better not to do... because you did them. You learned.

Hedge fund managers make tons of money because they started with lots of money and they know what to do.
Their knowledge came with time and patience. Those are not unique and we can reach that point.
What we do not have is millions of dollars but to be honest? Do we need millions? They have to make that much money because they have millionaires funding them, lots of people funding these hedge funds all expecting big profits. There is pressure to compete and meet these expectations. They have to find ways to grow and protect a ridiculous amount of money.

Us? We just need $2,700 a month. In comparison we have it easy. All we lack is knowledge but that can be gained with time.

Disclaimer: The investments and trades in my videos and blog entries are not recommendations for others.
I am not a financial planner, financial advisor, accountant, or tax adviser. The financial actions I talk about are for my own portfolio and money and only suited for my own risk tolerance, strategy, and ideas. Copying another person's financial moves can lead to large losses. Each person needs to do their due diligence in researching and planning their own actions in the financial markets.

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