Moral of Galleon Insider-Trading Bust: Only Fools Try to Beat the Street

It's the trading that's the problem. Investing, you can do fine.

I'm an investor so I could care less.

I feel you are absolutely correct in your assessment of an individual trying to time the market against people that have more experience, more money, more contacts, etc. that an individual would ever dream possible. I invest my money in mutual funds and have been satisfied with my returns over the years and the market does seem to be recovering from its downside last year. I just hope that it continues for a while longer.

Just buy gold and silver, you can't lose. It will never go to ZERO. And with all the phantom money creation it could go to the moon.

very well written article. definitely a case for passive investing.

There is no investing in the market as that is and has been dead for a long time. Wall St. flushes out the buy a hold investors every 5 to 10 years. How do you think the bandits make so much money?

Buying quality stocks, lots of them, with good financials, will pay off when invested over a long period of time. Getting rich that way is not guaranteed, but a reasonable return should be expected. Cash invested at 5% in a bank is a good long term investment and so is well-located real estate. I remember gold in the 80s at 850/oz and the next year it was 250/oz. Watch for bubbles in all investments, there is no such thing as an investment that can never lose its value.

I agree with you, except that, stock market is not investing. It is trading. They sell stock to the public when the return is not left in the underlying asset anymore.

Also the hedge funds face the zero-sum game. They must out-trade the sum of other trades, including hedge funds. It is widely known that many hedge funds were left on the wrong foot this spring. They missed the rally. I listened to Jim Cramer, and I did *NOT* miss the rally. I also listen to you and Aaron - every single day. You are great, but on the Jim Cramer issue - we probably do not agree. He has indeed helped me a lot, although he is dead wrong from time to time. Nobody should do exactly what he says, but it does not hurt to listen in.

Also the hedge funds face the zero-sum game. They must out-trade the sum of other trades, including hedge funds. It is widely known that many hedge funds were left on the wrong foot this spring. They missed the rally. I listened to Jim Cramer, and I did *NOT* miss the rally. I also listen to you and Aaron - every single day. You are great, but on the Jim Cramer issue - we probably do not agree. He has indeed helped me a lot, although he is dead wrong from time to time. Nobody should do exactly what he says, but it does not hurt to listen in.

Is Cramer really a pure trader or is he something in between an investor and a trader? If the latter, then the criticism does not hold.

The only thing that truthfully moves stock prices is money. There's a direct correlation between accumulation and distribution and stock price movement, in fact, they mirror each other. Until money begins to flow into the stock it doesn't matter what the averages are doing, if the stock is under distribution, the price will fall, 100% of the time. In fact, hedge funds use trickery to make it look like the stock has reversed trend to get other investors to dump their money into the stock but they can't fool the money flow chart with price spikes on low volume.

Can we please prosecute a white guy.... why single out the "bad" foreigners.. Madoof coudn't be helped because he was in so far over his head... let's get some white heads rolling... make my day

So only the ruthless, sneaky cheaters that act like Serbs will win in trading. Viva investing or the mattress

So only the ruthless, sneaky cheaters that act like Serbs will win in trading. Viva investing or the mattress

I usually beat the 'pros' so I don't agree with the point of this article. The trick is to use the right information. The analysts do the financial statements stuff for you. (assuming they do that right). You need to see where the future is going based on real, hard nosed, and often unpleasant, information. Not the feel good propaganda that is thrown at the public by the government and Wall St. The use that good info to make a simple plan, then actually follow that plan, in spite of the nonsense being thrown your way.

Excellent cautionary tale. Even the most skilled and disciplined traders tend to lose over the long term. Why? Because the odds are against winning. It is a zero sum game and that sum must include transaction costs. Investing over the long term reduces transaction costs, but it is no panacea. Most investing/trading profits derive from the main trend. If rates are zero, the trend is down, and earnings are in decline, a long term strategy will probably not save you. You're going to need luck and lots of it.

ezshooter - Monday October 19, 2009 04:39PM EDT Buying quality stocks, lots of them, with good financials, will pay off when invested over a long period of time. Getting rich that way is not guaranteed, but a reasonable return should be expected. Cash invested at 5% in a bank is a good long term investment and so is well-located real estate. I remember gold in the 80s at 850/oz and the next year it was 250/oz. Watch for bubbles in all investments, there is no such thing as an investment that can never lose its value. /////////////////////////////////////////////////////////////////////////////////////////////////////////////////// ez- Hi, if you buy and hold you will loose. As the best you can hope for is to be even with inflation because the Pros of Wall St. extract most of the gains not the sold called investor. As far as gold/silver/platinum I've been buying physically since about $300 Gold and am very happy with the value of my precious metal assets. It has done much better than than my equities but not as well as my option trading. But options trading is stressful work. The precious metals will never return to the past lows while equities eventually most definitely will crash. So think about having some gold/silver in your asset mix, even if you decide to wear it, as it will gain in the long run. OK so how is real estate doing in FL?

You show me some rich, fat-cat, whatever. And I'll show you a cheat, liar, crook, thief, human scum, lower life form! And I can show you someone that tries to make it honest. He'll be the guy with his pockets turned wrong-side-out, liveing under a bridge, trying to find something to eat out of a dumpster! I know what it takes to be a rich, fat-cat, pig! Take a look at the bottom of their shoes. Thats the guts of the honest, working smucks that think's if they work harder, try harder, and play fair and do the right thing, they might get a little bit of the pie. WRONG! Your not going to beat a crook, liar, thief, cheet, pig when he has the game rigged to steal your money and fatten up his fat pockets.

"as have countless other stock-picking gurus since the dawn of time."! First of all, there has not been stock-picking gurus since the dawn of time, so right there you are proven to be incorrect! Also, there is a big difference from taking 'good' advice from a stock 'promoter' versus taking advice from a stock picking mutual fund manager like Peter Lynch who give the advice that you make fun of in his two books...what have you ever accomplished year after year that we can verify the results on? I do my own research on companies by studying industries that I am familiar with, reading SEC filings, websites, and by calling up the companies to get a feel for managements honesty and do much better than putting my money in a CD; certificate of depreciation or in some SP clone mutual fund.