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I'm a former reporter, private investigator and institutional equity analyst who digs deep to find niche undervalued and undiscovered securities. I manage money for individuals, institutions and family offices via my business Long Cast Advisers. This blog is part decision-diary, part investment observations and part general musings about Philadelphia sports. It is for entertainment only and should not be viewed as a solicitation for business or a recommendation to buy or sell securities.

Thursday, February 12, 2015

Charlie Munger's harness racing analogy; (why sitting on your hands might sometimes be best)

CM writes: "I used to play poker when I was young with a guy who made a substantial living doing nothing but bet harness races.... Now, harness racing is a relatively inefficient market. You don't have the depth of intelligence betting on harness races that you do on regular races. What my poker pal would do was to think about harness races as his main profession. And he would bet only occasionally when he saw some mispriced bet available. And by doing that, after paying the full handle to the house ‑ which I presume was around 17% ‑ he made a substantial living."

http://goo.gl/Osc4eN


For people who invest professionally, there is an urge to invest even if sitting on their hands waiting for the right investment might be the best decision. No decision is itself a decision, and sometimes the hardest, but occasionally the wisest.




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