Ken Fisher is a money manager, and on the list of the Forbes 400 Richest
Americans. He is also a Forbes columnist, where he recently recommended several
income stocks, such as Sims Metal Management (SMS), Net Servicos de Comunicacao
(NETC), and PetroChina (PTR). His latest book, Debunkery: Learn It, Do It, and
Profit from It-Seeing Through Wall Street's Money-Killing Myths was just
published. He is also author of several other books, including The Ten Roads to
Riches: The Ways the Wealthy Got There (And How You Can Too!) and How to Smell a
Rat: The Five Signs of Financial Fraud Ken Fisher Interview Part 7 Please note:
The complete interview took place on Wednesday, October 27, 2010 Stockerblog:
There was an article recently about how some investors got early retirement,
they had nothing better to do, did a lot of research on their stocks, and were
very successful. The article talked about one guy who built his portfolio from
$30,000 to $3,000,000. Do you think that article was about an aberration or just
looking at one end of the bell curve? Fisher: That's looking at the very few
people who are definitely one tip of the bell curve. And it's not the average
investor that could possibly consider it unless they had an extreme amount of
luck to achieve anywhere near that. The average investor by definition cannot do
that. The average investor cannot possibly beat the market. The average
investor, at most, can equal the market. Stockerblog: Speaking of playing the
market, the Bunk chapter on swine flu and some of the other things. It seems
like someone who trades or does short term investing could actually play the
opposite of some of these bunks. The swine flu could be an example or some other
major catastrophe where the market has a temporary sell-off, and if you are
mentally set to go into the market to do the opposite, a trader could actually
do fairly well playing to opposite of the common bunks. Would you agree with
that? Fisher: I think that's possible but for the average person that thinks
it's a trade, that he or she is a trader, is exceptionally unlikely. In fact,
when we look at the history of traders, most of them don't do very well. Said
another way, if you say who are the traders we can think of that have become
legendary investors, are really, really rich and successful as traders, there
aren't very many of them; although we have a lot of traders in total, which
tells you that it's another one of those things where it's a tip of the bell
curve where people have a knack to do that but they're very unusual and they are
probably least like our primitive stone age ancestors. They probably have the
leave behavioral finance issues embedded into their brains for some reason. But
there aren't very many of those people and the odds of anyone being one of those
people is small. If the person that can trade these things, which I do believe
there are people who can do it but its not me that's for sure, if there are
people good enough to trade these, they are good enough to trade all kinds of
other things. So another one of the bunks that you will remember reading about
is my comments about gold, and gold is basically a thing where if you're a very
good trader, gold might be a good thing for you but gold has had an OK return
but a huge volatility over time, and 85% of history on a monthly basis has lost
money, and made all its total return out of 15% of the months. If you're a good
enough trader, you should be able to trade gold successfully and you should be
able to trade all kins of other things too. And you don't need an trading advice
from me, that's for darn sure. The fundamental nature of those rare George Soros
like traders or Paul Tudor Jones type people, the people at have made money off
of trading that have gotten good returns and have had some consistency, because
you can trade gold, you can trade oil, you can probably trade swine flu, but
most people aren't very good traders. End of Part 7 The Debunkery book is
available at Amazon . Ken Fisher obviously doesn't give individual stock
recommendations in his interviews, but some stocks he likes that were mentioned
in his recent Forbes columns, including high dividend stocks, are available in
the form of a free Excel list at WallStreetNewsNetwork.com. Part 1 of this
interview is available HERE . Part 2 of this interview is available HERE . Part
3 of this interview is available HERE . Part 4 of this interview is available
HERE . Part 5 of this interview is available HERE . Part 6 of this interview is
available HERE . By Fred Fuld at Stockerblog.com Disclosure: Interviewer doesn't
own any of the stocks mentioned in this interview series at the time the
articles were written. Copyright 2010. All rights reserved. Reproduction of this
interview prohibited without permission. All opinions are those of Ken Fisher,
and do not represent the opinions of Stockerblog.com or the interviewer. Neither
Stockerblog nor the interviewer nor the interviewee are rendering tax, legal, or
investment advice in this interview. If you want tax, legal, or investment
advice, contact the appropriate professional.
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