Gamblers vs Investors

“The future will not be as good as the past but it doesn’t have to be.” This statement from Charlie Munger summed up his thoughts on public markets. Public market in the U.S. will not repeat the success of the late 90s in the 21st century.

Successful investors seem to focus on...

1. Obvious prospects for physical growth in a business do not translate into obvious profits for investors. 
2. The experts do not have dependable ways of selecting and concentrating on the most promising companies in the most promising industries.

Risk no more than 1% of the trading account on each stock trade. 

Let’s say that I am trading a $100,000 account. I will risk only 1% of my account, or $1,000. If I enter the stock at 100 and the 50-day moving average is at 95, that means that my risk is 5 points on the stock (100-95). ...