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Nicolas Darvas: 1955 - 1960
What do I Like About Nicholas Darvas
Where do I start I consider Nicolas Darvas the BEST trader, or as he him-self said investor in the world. Ill admit one mans poison is another mans medicine. You cannot really define what is the worlds BEST trader. Its my opinion.
Why You must, absolutely MUST, read, re-read, study and think about every line in the book How I Made $2 Million in the Stock Market. I wont lie when I say I have read it over 100 times and I still read it at least once per month. Amazingly I keep learning new points.
Darvas was actually the first CANSLIM trader without going into the finer points. This may up-set William ONeal followers. Whilst Darvas did not actually study earnings, sectors, shares outstanding etc. his off the cuff stock selection meant he was using CANSLIM methods. Dont forget this was way back in the late 1950s.
He turned $25,000 into $2,25 million by scanning the newspapers in just five minutes during the late, night early morning, period. He him-self said it wasnt so much the amount of money he made that pleased him but the ease and peace of mind it was achieved. It was SO easy. Admittedly, he was lucky in that he traded his system during a roaring bull market. But his system makes money in all market conditions. Its just a fact that youll make a lot more during a run-away bull market. That can be said for most systems.
The perfect attitude for trading. When he was wrong on a trade he shrugged his shoulders, cut his losses and looked for the next one. No second guessing. No emotion. No ego involved. He told the reporter who interviewed him for a time magazine article he only expected to be correct half the time.
Without doubt his best quality was his ability to question everything. When he was wrong why What worked and why What didnt work in the stock market and why Question everything and eliminate what doesnt work. He pieced together a system that fitted his personality. The person who can do this will be a big winner in the markets.
Flaws:
What flaws can the worlds best trader have Actually there is one and it was a very dangerous one.
Money management. Boy was he lucky! Buying a 100% position on leverage on one stock could have been the death of his account. When he bought 2,500 shares, on margin, of E.L Bruce (a small cap un-known stock) IF things had have turned ugly here, i.e. prices gapped down or fell off very sharply, no doubt Darvas would have been finished. Instead of writing a book about how he made his fortune in the Stock Market he might have written one about how a fortune was lost. Luckily he made over $300,000 from this transaction alone. Had he have had some money management rules in place, sure the gains would not have been as big, but at least IF things hadnt have worked out he could live to fight another day.
A number of occasions Darvas plunged into the market with little thought to money management and risk. Ignorance really was bliss. Jesse Livermore was not quite so lucky.
Conclusion:
A shining light of hope to the man on the street that anyone given time, education, desire and determination can make BIG money in the stock market. You dont have to have state of the art technology, data, or in-side information to make massive returns.
If Darvas can make $2,25 million by scanning the papers for five minutes before bed what does that say for todays Hi-tech trading techniques
His methods still work and always will work. If it stops so will the stock market.
* * * * 1/2 41/2 Star Trader (P.S. there will never be a 5 star trader)
Mark CrispThe Stress Free Momentum Stock Trader
Real Estate Investing Benefits
There are many reasons why investing in real estate over other investment avenues is a safer and more profitable route to take and we will go over just a few of these factors with you in this article.
First thing to note is that if you look at the real estate market as a time line compared to the stock market you will notice that real estate is a growing line with few major fluxuations. On the other hand the stock market has high points and valleys that range from quick highs to sudden drops through out its history. Its harder to look at the time lines of other forms of investing i.e. currency investing, mutual funds, buying gold and silver etc - but one thing is clear, no other market is as profitable or as safe as the investment real estate market.
Many people ask me Why is investing in real estate such a safe investment and the answer is as simple as it is complicated, the quick answer is God isnt making any more of it the more complicated answer isnt as poetic. The reason investing in real estate has so many benefits has many factors, I will go over the basics with you now:
1. Government Tax Breaks - The United States government has setup multiple tax breaks for real estate investors including the very popular 1031 exchange. The textbook definition of a 1031 exchange is:
A 1031 exchange or Like kind exchange is defined by section 1031 of the Internal Revenue Code. This code specifies that if an asset, usually some form of real estate such as land or a building, is sold and the proceeds of the sale are then reinvested in a like kind of an asset then no gain or loss is recognized, allowing the deferment of capital gains taxes.
The simple explanation is as long as you reinvest the money you made from your real estate investment into another investment you dont have to pay taxes on said profit. No other form of investing gives you this much freedom with taxes.
2. Anyone Can Invest - Because real estate investing is so profitable and safe it sees a huge amount of amateur investors entering the market everyday. Why else do you think all these infomercials are on late at night talking about the millions theyve made overnight with someones CD set O.k. Im not saying that buying one of those CD sets will make you a millionaire but they are good to learn the basics of real estate investing from. The big problems with these CD sets is they teach making millions in real estate with bad credit or without spending a dime. This is not the case, 99.9999% of the time you will need excellent credit and a good amount of money for the down payment on an investment property (usually 10-20%).
3. Other Peoples Money - Why invest your money when you can invest someone elses One of the big rules in real estate investing is If someone is willing to flip the bill - let them. Banks are more then willing to give out a loan to buy houses because unlike other forms of investing they have something tangible they can keep if you dont pay up. Banks are usually not as willing to give loans for stock or gold investing because the stock you invested in maybe worth nothing by the time you sell and the bank has nothing OR you take your gold and run across the border. Real estate is almost always going to be worth something (often increasing in value every year) and their hasnt been a recorded case yet of someone taking a house across the border.
Right now the investment real estate market is booming like never before in history and those investing in it are being rewarded more so then in any other time in. If you want more information on this explosive market feel free to visit my website or give me a call and I will answer any question you may have.
Goldberg Executive Realty Group
Mark Goldberg
Phone: 1-866-247-2259
E-mail:
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