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This is a knee jerk post. I just heard an ad for Schwab where they said they will sharpen your trading skills to learn how to trade brilliantly.
What immediately popped into my mind was I am not, nor do I want to be, a brilliant trader. I want to be a brilliant investor (hardly the case but I’m trying).
What about you? Do you aspire to be a brilliant trader or a brilliant investor? For I think they are totally different creatures.
Hmmm. I don’t know what brilliant is, in this context. I invest to beat inflation, although I do attempt to do better than the indexes. A significant portion of my holdings go back about 20 years, but I do own a few newer stocks. I don’t own an index fund per so. Back in 1990 or so I did buy and sell more frequently. My numbers indicated the brokers were the ones making money. After the Dot-Com bust I became more cautious and shifted to buy and hold. I didn’t even bother to buy during the recent dips, nor did I make any significant changes after the most recent presidential election. I did make several stock purchases in 2024, aside from automatic reinvestment of dividends.
I am primarily an investor, but I have done a few trades.
If you do a trade, you have to be disciplined and exit the position whether you win or lose. If you let a trade turn into an investment, you will lose for sure.
My trades were utility-merger arbitrage.
I was fortunate to work at a mutual fund company (hint: this mutual fund company has an ETF started with a letter Q). Hence, I learnt the tricks of the trade while providing IT support for the trading team. Knowing my capability, I’d rather be a brilliant investor than a trader.
I am a little bothered by the tone of this discussion. I have done business with Schwab as an investor for 35 years. For all that time i have been buying and holding, and never trading. And, for all that time, Schwab has also been supporting customers who wanted to trade. There has never been a time when I received less than stellar service despite the fact that I never trade.
And, while I believe that buy and holding index ETFs is a better strategy than trading individual stocks, index funds and ETFs need traders and investment managers trying to beat the market in order to create the market price and overall results which they seek to emulate.
All the major brokerages support those who wish to day trade or do something other than buy and hold. Given that we have a free market economy this is exactly how things should operate.
I’m sorry if my comment came across the wrong way. Schwab is a fine company offering excellent service. Its platform for certified financial planners is said to be very good.