DSP OFF-TOPIC Thread

In one of his books it supposedly works pretty well for the author.
He bought the acme brick company in 2000 and is looking to buy the largest bookstore in 2020.
A type of 'no risk stock' is low tech industry, staples aka the original stocks, obvious market proof brands, super diversified mutual funds, government bonds, insurance industry. Even if the buy price is high the chance of loss is not dangerous and can be insured.
Another 'no risk' would be to buy cheap stock in prospects and rookie companies that show promise to see which one hits like a lottery pick at late 2nd rounder price like Kuzma.
Drafting Kuzma was no risk.
Now he has shown that he has adjusted to being a pro seamlessly.
He's a pro naturally.
Thats why hes no risk when building a championship team.
All other prospects no matter how promising and valuable had to go.
They are high risk stock to buy for a team looking to cash out soon.
Kuzma on the other hand is all reward no risk and the team has bought a few years worth of rights to keep buying his stock at a low price as his value continues to soar.

 

If it was that easy (or even that possible), there would be no need to write a book. You could easily make all the money you'd ever need off the markets and never have to do anything else. Writing books is hard and time consuming. Life would be hookers, blow and making all the money you ever needed whenever you felt like trading.
These guys write books because they need money--they can't reliably make it in the markets or with their other schemes.
Very few "experts" outperform the broader market with any kind of statistical significance.
Over the long term, you're gonna make 7-8%/year that way, but you have to be able to ride out the volatility.
Nobody is going to let you significantly leverage against that...just 25-30% of your assets at best, and they're going to charge you a shit-ton of interest. Usery type interest because there's a pretty good chance they're not going to get paid back.
You can't use insurance to protect against volatility like that, either. At least not if you want to have more money than you started with. Insurance companies are in the business of making money, so in the long term, they take in more than they pay out. You might get lucky once, but in the long term, the insurance is going to cost you money, not protect your losses.

 

That is why the first thing you invest in when you start doing deals that need to be highly insured is in an insurance company.
You are right about those book writers that write books to make money off of their system. I was mocking them in my post.
As a general rule you are right.
The proof of that being the exception that some successful people are not interested hookers and blow but living in a regular house in the same quiet middle class suburban neighborhood they grew up in.
Those people have time to run their businesses and write a book.
Or maybe they have their secretary write the book for them.
I hear that those guys pay less taxes than their secretaries.

 

Margaritaville is one of my favorite songs.

 

They are probably related and part of the conspiracy theory of conspiracy theories.

Warren Buffett goes on a TV show and after a disaster and tells corporate america that there will be another one of these or similar coming soon and that you better have insurance against this new threat as well as this that and the other thing you need to buy to be safe in case this threat happens again because it will and soon. He knows this because he has done the research.
Buffet tells them to buy and before they buy his signals start raising the price so they buy even more which make the stock prices solidify their new growth.
Before he opens his mouth he has already compiled loads of analytics that give him a good idea of why things are happening and how they are about to happen and how to best profit from them depending on how he plays his advantages.

Some of those advantages are that the old man owns majority shares in some old branded insurance company currently being heavily re-marketed positioning itself as the leader in this new Buffet scare mongering expanded market.
And that he is heavily invested in the startups inventing the new this that and the other that you need to protect your house or stadium or office building from the coming disaster.

He is a snake but kind of in shepherds clothing signaling to his sheep where they should go because he has walked the road or scoped it out from on high and can report that it is good grass to graze.

 

Dude talks about moats all the time.
Sometimes you have to put the fear of (acts of) God in people's minds to get them to dig your moats for you.

 

I don't know what this insurance is you keep speaking of. There's no policy I know of that you can buy to indemnify random stock investments from market losses. I suppose variable annuities with living riders are technically a form of insurance, but those typically will protect the future earning stream of an investment, not the principal directly. And I've yet to see one that lets you select the stocks - usually they have a set lineup of mutual fund options. Are you perhaps suggesting incorporating a type of derivative strategy, using call or put options to protect your investment? I guess you can call that a form of insurance, but you'd be capping your upside in exchange for some downside protection. There are market-linked notes that can help limit losses - effective strategies, but they don't remove market risk completely, and you can't pick your own underlying stocks unless you're doing it at the seven-figure level. Market-linked CDs do fully protect the principal, but the upside again is significantly capped.

That's as close as I can get to insuring my investments, so what am I missing?

 

Even if you *could* simply buy insurance that way, it's still a losing strategy.
They insurance companies have to make money, and over the long term you'd have to lose money by insuring against losses.

 

The principle is never in peril.
The main investments don't need any protection.
Capping your upside is part of the philosophy.
You keep stumbling over this part because capping your upside seems anathema to the philosophy of capitalism.
It is actually the spirit of capitalism that has been transmogrified into what it is now.
Or to put it simpler it is an error in perspective.
You are 100% correct as per your school.
But your doctor needs you to need pills with fucked up side effects.
Your dentist needs you to need painful and expensive dental work.
And your dealer needs you to need the instant relief of his drugs.
That is not capitalism, that is wizardry.

Capitalism is not a race to the pinnacle.
It is a race to build your capital. Your heart.
Then once you build it you protect it.
And once you protect it to project it by the power of its own force.
Which is to go forth and multiply.
Projection allows a small capital to appear like a giant pyramid to those with the opposite perspective.
Those in that opposite perspective = prospective victims catharted into your multiplied multitude of customers.

Capitalism is not Iron Man.
Its not about the future/endgame/destiny/thanos.
Capitalism is Captain America but he went out of favor a long time ago because he put wings on his helmet and boots.
The philosophy of capitalism in the heart of each man is different.
Iron Man is how we now have decided to practice and understand it.
Luckily there is climate change to thaw that frozen heart out of its ice cap.

If you really wanted more info I could link to a video of a financial advisor.
Sure he wont change the subject into long winded pop culture based philosophical arguments and examples abstracted out of his ??? when he doesn't have a more readily available way to clarify the answers the questions you were asking and instead beg you to ponder the the idea that there is a mathematical logic to making $$$ from the seemingly vacuum of [ |-| @ () $ that creates something out of nothing by projecting upon those that sell their goods, services, and credit the thing that satiates their desire.
A good deal.

He will instead answer you with a bunch of mumbo jumbo finance speak that you wont truly understand but will nod your head to and feel sufficiently satisfied into believing you understand enough to fork over the money he will charge you for putting a series of current jargon in the current predetermined order proven to convince your segment of the demo how to maximize their investment for the most efficient gains staying one step ahead of the game with his help to assure you the most profit.
Which is his way of force projection that from my perspective is capitulation not capitalism.

 

Nothing that complicated, I was responding to the hypothetical concept of buying insurance to cover speculative losses. That's always a losing strategy in the long run.

Agree that you could use derivatives to limit your downside risk, but at a cost.

With regard to credit-default-swaps, like any investment, you can get lucky with timing and make a lot of money, that doesn't mean it's always a winning strategy. In the case of CDS, sooner or later someone is going to get left holding the bag when they actually start defaulting and the equities that back them don't cover the debt.

 

Yep. Maybe it only should have been AIG's shareholders, but we all got to bail them out.

 

This is the insurance I am talking about.
There is always insurance when you bet alongside the wave that can't lose.
If it loses everyone loses and so it can't be allowed to lose.
If you understand that then you know what bets are safe.
The only way you lose is if everyone else loses too.
And at that point everyone's a winner.

 

still the happiest place on earth
where the fuck is the security/police?