No. of Recommendations: 10
Well, now that you mention it, let’s see what two wise old gentleman have to say about LEAPS, options, and other forms of investing leverage. Is it wise to ignore their counsel or is there really that large of an audience on here that dabbles in trading BRK using leverage? Is it boredom that creates this temptation to eke out a few more bps in performance? Although I have seen option discussion evolve into an almost religious fervor on here lately, I sense that the silent majority of subscribers, in their heart of hearts, probably are LTBH investors, at least as it pertains to BRK. And by LTBH, I don’t just mean through thick and thin. There are times when asset allocations need adjustment as one ages. I’m just talking about the advantages of making as few decisions as possible during an investing lifetime…the 20 punch analogy, if you will, and then sticking with your discipline. I really don’t see this as boring at all…in fact, it’s actually quite exciting to witness this rolling snowball effect over time. Just as there are sophisticated mathematical models that backcast and channel the BRK value/price wonderfully over time, there are also other mental models that seem to be working well for some of us. By that, I mean the discipline to simply “buy the damn stock” and hold over time.
Behavioral finance that emphasizes “lethargy bordering on sloth…as the cornerstone of investment strategy,” along with inaction, is not often discussed or heralded on here as an effective approach but it really is just as equally important, if not more so, than those who are nimble enough to profit from timing models. I applaud those who have audited results that can beat a Rip Van Wrinkle approach, but we can’t all be like Jim, nor do I want to be like him. It requires a steep learning curve, and a willingness to dive into a level of complexity that cannot be easily absorbed without a lot of commitment and financial background. No offense to his rich data driven approach, but it’s easy to get lost in the weeds.
Oops…and as I just looked up on my stock screen, BRK just hit another new high. Oh well…I guess I’ll go back to being mindlessly boring again! 😆
https://youtu.be/E02R8Te9o50?si=wnN0n2njBjuNsw8L 