Comments on: Beginning Investment Strategies to Avoid

By: Carnival of Financial-Planning 10-02-09 | Finance Blog

Carnival of Financial-Planning 10-02-09 | Finance Blog — Wed, 06 Jan 2010 12:53:40 +0000

[...] Pillars presents Beginning Investment Strategies to Avoid posted at Quest For Four Pillars, saying, “Some investment strategies that beginners should [...]

By: Today’s economy media pack – 2009.09.18 | Today's economy blog

Today’s economy media pack – 2009.09.18 | Today's economy blog — Wed, 23 Dec 2009 19:36:13 +0000

[...] Four Pillars. Beginning investment strategies to avoid. “On Tuesday I posted about Beginning Investment Strategies to Consider, and as promised, in this post I’ll detail investing strategies I think beginner investors should avoid.” [...]

By: Peak Personal Finance

Peak Personal Finance — Thu, 08 Oct 2009 19:46:31 +0000

Personal Finance News Carnival Volume 8…

Hello and welcome Volume 8 of the Personal Finance News Carnival. Here at Peak Personal Finance, we’ve been busy lately updating our blog theme and layout — please be sure to submit a comment and let us know how you like the new lo…

By: Intelligent Speculator | Financial Ramblings

Intelligent Speculator | Financial Ramblings — Sat, 03 Oct 2009 18:35:58 +0000

[...] Pillars discusses strategies you should avoid when starting to invest, many good ones and a simple but useful article for any [...]

By: Carnival of Financial-Planning 10-02-09 | Success Secret

Carnival of Financial-Planning 10-02-09 | Success Secret — Fri, 02 Oct 2009 21:12:13 +0000

[...] Pillars presents Beginning Investment Strategies to Avoid posted at Quest For Four Pillars, saying, “Some investment strategies that beginners should [...]

By: Carnival of Financial-Planning 10-02-09

Carnival of Financial-Planning 10-02-09 — Fri, 02 Oct 2009 19:27:49 +0000

[...] Pillars presents Beginning Investment Strategies to Avoid posted at Quest For Four Pillars, saying, “Some investment strategies that beginners should [...]

By: The Financial Blogger » Blog Archive » Financial Ramblings

The Financial Blogger » Blog Archive » Financial Ramblings — Sat, 26 Sep 2009 20:53:10 +0000

[...] Four Pillars has a great article on beginner investment strategies to avoid. [...]

By: Michael - The Fat Loss Authority

Michael - The Fat Loss Authority — Sat, 26 Sep 2009 19:03:40 +0000

Completely agree with you regarding real-estate investing. Too many books and infomercials out there make it seem as easy as 1-2-3. Rich dad, poor dad series of books comes to mind.

Mike

By: Mark Wolfinger

Mark Wolfinger — Sat, 26 Sep 2009 18:12:34 +0000

Mr C.
You make good points – especially about who should NOT use options.

The term ZSG is not that important.

By: Mr. Cheap

Mr. Cheap — Sat, 26 Sep 2009 17:37:39 +0000

Mark: Yes, this is true. It’s also true that a small allocation to gold can be worthwhile in an asset allocation, as it is a good inflation hedge and tends to have low correlation with other asset classes. And real estate, in the form of REITS or individual properties, can also have a place. And, and, and…

My point for this post wasn’t to say that all of these investment categories are “bad”, just that they’re inappropriate for beginners. If someone understands your point, clearly they aren’t a beginner, and power to them however they use options. If someone doesn’t understand what you’re talking about, then they should steer clear of options until they understand the issues enough to make up their own mind.

Just because they can be used to hedge risk DOESN’T mean that options aren’t a zero sum game. If you combine them into a more complex investment vehicle that makes money even when the option loses money doesn’t stop them from being zero sum game. If an options has utility for the investor beyond what is made or lost doesn’t mean they aren’t a zero-sum game. Options ARE a zero-sum game (that doesn’t mean they’re good or bad, it’s just what they are). “Zero-sum game” isn’t a pejorative, it’s just a description.