OT: Buying Stock

[Christopher Browne]

On 2/20/08, Asaf Maruf <asafmaruf-Re5JQEeQqe8AvxtiuMwx3w at public.gmane.org> wrote:
> I think i did not make my point clear. I maintain that for a person to
> venture into buying and selling stocks, one has to be very well prepared.
> There is too much risk involved.

That is missing two other forms of risks that you seem willing to ignore:

1.  Interest rate risk.  Interest rates have a habit of going up and
down.  Your philosophy ignores that.

2.  Inflation rate risk.  If you stay in "seemingly risk-free"
investments, you can find the value of the investment chewed up by
inflation.

People sometimes choose to fail to perceive these risks, but that does
not make them go away.

> Alternately, one can go with the less risky instruments like GIC's, mutual
> funds and other government securities. Not much preparation is required
> except for knowing your fund manager and details of the instrument.
>
> They can give a decent return of 10-15% on average.

Huh?  Tell me where I can average HALF that.

ACTUAL GIC rates are ranging between 2.5% and 3.35%.
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