Step aside Warren Buffett
The game of stock investment is no longer the same game Buffett knew in the past. Then it was just picking stocks on fundamentals, buy and sit on them and in the long run, well managed companies with growth stories will run up the ladder, paying dividends and higher stock prices. The formula was simple and logical. Buy only good companies. Today stock investment is a new ball game. Calling it investment is a misnomer. It is no investment but pure speculation or gambling. The nature of the game has changed completely. Stocks are being substituted with derivatives, options, covered warrants, ETFs etc that interests in the actual stocks have diminished. Money is placed on all the other instruments rather than the stocks. Companies hardly offered the conventional warrants which have died a natural death. And if the trend goes, stocks too will die a natural death when trading is on derivative instruments. Then there are the big money that are used to ramp stocks up and down at the slightest news or excuses. Either way, the big money will make more money. The conventional investors sitting on their golden stocks will see them battered down one day or up the next, sometimes with little correlations to the worthiness of the stocks and their businesses. With high powered and high speed machines and marginal commission to pay, the big money would take full advantage of their unfair advantages to push the market and stocks anyway they want and cleaning the investors of their long term investments. Investing for the long term, being paid dividends, bonus shares, waiting for prices to grow steadily are bad premises that no longer hold water in stock investment. It is hit and run, going with the tide, or the market makers, provided the investors guess it right and hitch a ride. Investing stocks for the long haul is likely to be a big roller coaster ride with many shocking moments, and may not see the stocks appreciating in price over time. It is all about selling and buying papers ie derivatives with some having zero intrinsic values.