(20-06-2012, 10:42 AM)mobo Wrote: [ -> ]But can I just do an informal poll (I trust participants here are not like the usual big cannon fairies in CNA or HWZ) who here has 10 yrs of investment experience and has managed to make a compunded return of 8% - 10% p.a.
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Looking forward to more responses!
This August it will be my 10th year anniversary of investing. So I guess it is close enough. But I did not achieve 8-10% per year. I achieved 20-21% compounded per year. However the disclaimers below should be kept in mind:
1. In the beginning the investment sum was very small. I started with about $500 (yes, five hundred dollars).
2. There was a bull market during 2003-2006 (
edit: 2003-2007).
3. Historical volatility is high. I have never had an "average" year where returns were 20-21%. Sometimes it was much higher, sometimes much lower, even negative (2007, 2011) (
edit: 2008, 2011).
4. I turned professional after 6 years. Even in my early years I spent as much time and effort on investing as on my "real" job, maybe even more. So it is not a fair comparison for the average investor who cannot devote this kind of time and effort.
But this is also a message to the investors out there who feel that they don't have the necessary capital or knowledge to invest successfully.
It can be done.
I started with no money and no knowledge. I saved from my salary and read many books on investing. This much is not difficult. Anyone but the very poor can come up with $500, or, allowing for inflation, $1000. Books are not expensive, and can be borrowed for free from the library.
But everything has a price. Knowledge can be acquired by those willing to invest the time and effort. Indeed, knowledge is the best investment I know of. It can be acquired from books, from other people, or by trial and error. I try not to use the last method if possible - it is slow and expensive, albeit highly effective: there is nothing like losing money to drive home a lesson.
Those unwilling to pay the price may find that index funds and ETFs do a reasonable job of putting money to work. Or, if they want more, they can look for professional investors to do it for them. It would be a good idea to find a professional whose strategy they are comfortable with, rather than simply looking at past results or a big brand name.