Nothing Succeeds Like Failure

We love rags-to-riches stories.

Like the Horatio Alger tales of yore, we’re captivated by the turnaround story. The Apple Computer that Steve Jobs arranges financing for, so he can bring out the iMac, iPod , iPhone, and iPad. Now Apple is so successful that the index geniuses at Nasdaq have decided to bet against it. (Good luck.)

Or the plucky emerging market company, like Petrobras, that markets its product to a growing China and grows to be one of the largest oil companies in the world. We like to cheer for the underdog.

That’s why so many people are enticed into buying penny stocks or hard-luck stories. An internet ad or a hot tip from an acquaintance promises stunning wealth in a very short time. Just look at what $1000 invested in Apple in 1994 did, they say. It would be worth $50 thousand today.

But lottery tickets rarely pay enough to justify their purchase. That’s why the states sell them! For every Apple out there there’s a hundred “Innovative Software” or “Wolahan Lumber” or “Magnetic Technologies” that either went nowhere or into bankruptcy. That’s why they call it speculation.

Investing is hard work and most people can be pretty successful if they establish disciplines, manage risk, and learn from mistakes: that is, if they do the work! That’s the side of the Horatio Alger story that’s forgotten—the sweat equity of equities. It can and is profitable, but only if you work at it.

Douglas R. Tengdin, CFA
Chief Investment Officer
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www.chartertrust.com • www.moneybasicsradio.com • www.globalmarketupdate.net
By | 2014-09-12T10:48:37+00:00 April 9th, 2011|Global Market Update|0 Comments

About the Author:

Mr. Tengdin is the Chief Investment Officer at Charter Trust Company and author of “The Global Market Update”. The audio version of each post can be heard on radio stations throughout New England every weekday. Mr. Tengdin graduated from Dartmouth College, Magna Cum Laude. He received his Master of Arts from Trinity Divinity School, Magna Cum Laude and received his Chartered Financial Analyst (CFA) designation in 1992. Mr. Tengdin has been managing investment portfolios for over 30 years, working for Bank of Boston, State Street Global Advisors, Citibank – Tunisia, and Banknorth Group. Throughout his career, Mr. Tengdin has emphasized helping clients manage their financial risks in difficult environments where they can profit from investing in diverse assets in diverse settings. –
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