recentpopularlog in

jerryking : seinfeld   3

Andy Kessler: Hedge Funders Are All a Little Nuts - WSJ.com
August 27, 2013 | WSJ | by ANDY KESSLER.

Hedge Funders Are All a Little Nuts
Sleepless nights, minds racing, working out both sides of all arguments, second guessing. Stay sane? No gain.

Carl Icahn bought $1.5 billion in Apple shares and tweeted, "We believe the company to be extremely undervalued. Spoke to Tim Cook today. More to come." This is known in the business as talking your book and, predictably, the stock popped to $500. (It's now $488.) Mr. Icahn apparently wants Apple to borrow $150 billion to finance more share buybacks, figuring the stock will go to $625. Maybe, but new products and earnings growth are the only long-term drivers of value, not an impatient investor with a few billion to throw around. Apple should ignore him.

When hedge-fund managers grab onto "sure things" rather than float, it's usually a sign they've lost their touch. Stay thirsty, my friends.

And what's an individual investor to do? Teach yourself how to think ahead of those who are scrambling for ideas. When everyone else is thinking short term, start thinking long term. Embrace ideas when everyone else hates them. Out-Costanza the hedgies.
Andy_Kessler  hedge_funds  contrarians  strategic_thinking  long-term  personal_finance  investors  Seinfeld 
september 2013 by jerryking

Copy this bookmark:





to read