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A Random Walk down Wall Street: The Time-tested Strategy for Successful Investing

Burton G. Malkiel · 3 HN comments
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Amazon Summary
The best investment guide money can buy, with over 1.5 million copies sold, now fully revised and updated. In today’s daunting investment landscape, the need for Burton G. Malkiel’s reassuring, authoritative, and perennially best-selling guide to investing is stronger than ever. A Random Walk Down Wall Street has long been established as the first book to purchase when starting a portfolio. This new edition features fresh material on exchange-traded funds and investment opportunities in emerging markets; a brand-new chapter on “smart beta” funds, the newest marketing gimmick of the investment management industry; and a new supplement that tackles the increasingly complex world of derivatives.
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Learn about it. I would recommend A Random Walk Down Wall Street [1] and The Boglehead's Guide to Investing [2]. They will give you a good primer, but in essence the best thing you can do it nothing at all. As you get older you'll want to make sure bonds take up a larger percentage of your portfolio, but really you're fine. The old sayings is "time in the market, not timing the market".

[1] - https://www.amazon.com/Random-Walk-down-Wall-Street/dp/03933... [2] - https://www.amazon.com/Bogleheads-Guide-Investing-Taylor-Lar...

Sure it shows the algorithm beats a hold strategy in 8/10 instances...

...but the "hodlometer.com" domain was registered 3 days ago.

It's trivial to develop an algorithm by cherry-picking parameters that will give any desired results for historical data.

But there's vast research on how it's impossible to predict/beat the market like this in reality [1], and this site is obviously designed to prey on the uneducated and naive.

[1] For a good intro, see chapter 5 of "A Random Walk Down Wall Street" which talks about "technical analysis", which is exactly what HODLometer is doing -- https://www.amazon.com/gp/product/0393352242

nshepperd
I notice that the N in "N days return" is different for each currency shown. The cherry picking here isn't even subtle!
mkrn
It's taking all available data from Binance API (Basically all the different cryptocurrencies have been listed at different times, therefore the difference in time ranges)

I can see though how it looks untrustworthy because of that, thanks for feedback!

Analemma_
People who know a thing or two about finance are having the time of their lives watching Bitcoin evangelists genuinely believe in technical analysis and not understand that it's on the level of astrology and tarot cards as far as usefulness in predicting prices. (And that's in a fair market. On Bitcoin exchanges, where it's certain that the exchanges are using every trick in the book-- frontrunning, painting the tape, wash trading etc.-- to stack the deck and extract extra value from your trades, technical analysis is even more useless)
lbotos
So you are of the mindset that technical analysis has no place in forming trades?

How would you suggest entering short term trade scenarios then?

I sound snarky, but I'm genuinely curious what you suggest instead.

Lerc
There is a basic pattern (bubble/pop/settle) but for any advantage you have to know better than someone else. There's been a number of images showing graphs scaled and overlaid over other graphs. There's quite possibly good reasons for the correlation in shapes, but it is also quite useless for investment. You might know something will probably happen but you don't know when or at what speed.

Once you go past the patterns that everyone can plainly see, you are looking for patterns in what appears to be noise to everyone else. Accurate future predictions is really the only way to tell if it is anything other than staring at tea leaves.

"A Random Walk Down Wall Street" is THE book I recommend for accessible framework on the different strategies people approach the stock market and investing.

http://www.amazon.com/gp/product/0393352242

Edit: WSJ Review: “Talk to 10 money experts and you’re likely to hear 10 recommendations for Burton Malkiel’s classic investing book.”

yonibot
This was my intro as well, and I've already recommended it to a number of people.

Malkiel believes in investing over gambling/speculating. That means trying to obtain market returns rather than trying to beat it, using very-low-cost funds like those offered by Vanguard. A great place to read more about this philosophy, when you finish Random Walk, is the Boglehead's forum.

swah
A good book to stop trading!
dforrestwilson
Khan Academy is a great resource for this. Salman worked in finance.

And it really does depend on how deep down the rabbit hole you want to go. I do equity research now... feel free to contact me.

n13
There's no contact information on your profile!
csabapalfi
https://twitter.com/dforrestwilson https://www.linkedin.com/in/dforrestwilson
jmcgough
Seconding this. If I could have all of my friends read a book after graduating college, it'd be this one.
gmu3
I'd recommend this as well. It's obviously an old classic but I read it a few years ago and was pleasantly surprised how updated the author has kept it.
companyhen
I'm on page 200 of this book. Didn't know much about investing beforehand, good read so far in my opinion.
yannickt
Random Walk is great. My favourite books on personal investing are: - "The Four Pillars of Investing" by William Bernstein - "A Random Walk Down Wall Street" by Burton Malkiel - "All About Asset Allocation" by Rick Ferri

If I had to recommend _one_, it would be Four Pillars. The first part is a bit more intellectually "challenging" than Random Walk, but ultimately does a better job (IMO) at backing up the author's ideas on personal investing with data.

Random Walk covers all the major bubbles in history, and does an excellent job at breaking down asset allocation per age range in the later sections of the book.

All About Asset Allocation was very useful to me in developing a long term investment plan, and deciding what asset classes to include in my portfolio.

I refer to each book at least once a year.

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