04 August 2011

Focus on what you do best

Thank you for reading my posts as I am writing the posts quite aggressively recently. What I would like to share with you is a story:

A and B are young guys who are very enthusiastic in investing. They are looking ways to learn investing. So they tried many ways to improve themselves in the investing skills. A is a very hardworking guy and he is also very smart and learn a lot of techniques of investing, such as Technical Analysis and Fundamental Analysis. B was average guy as his knowledge was very restricted to his working area - that was a construction sector.

As A always learn the new things, he keep on changing his investment philosophy as well as his investment strategy. Some times he focused on technical analysis, and sometimes he focused on fundamental analysis. He also read a lot of research reports as well as to try many methods on the investing by following the recommendation from the research analysts. However, as the research report needs timely update, A was always did the changes later and he was not informed when to sell until another research report was issued out to him.

As B was only focus on construction sector, hence he only stuck to what he knew best and invested only in the companies that he was familiar with. As he knew the sector very well, he knew the economic cycle and knew when to purchase more/less and when to sell more/less.

Time passed. B's result was better than A although he was not an active traders similar to B. He also did not have good background as compared to A. But he was still able to beat A.

What is your opinion or comment on the above story?

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