#but i expected the ratio to skew way more in his favor

[heynhay]

using my credentials as a top .1% mitski listener for two years in a row i have brought you mitski KL classifications

recommendations/strong matches are bolded

Laurel Hell // Be The Cowboy // Puberty 2 // Bury Me At Makeout Creek // Retired from a Sad, New, Career in Business // Lush

Keith

Everyone

Valentine, Texas

Stay Soft

Love Me More

A Pearl

A Horse Named Cold Air

Blue Light

Washing Machine Heart

I Bet on Losing Dogs

Thursday Girl

I Will

I Don't Smoke

First Love/Late Spring

Humpty

I Want You

Strawberry Blond

Wife

Door

Lance

The Only Heartbreaker

There's Nothing Left For You

Working For The Knife

Nobody

Me and My Husband

Lonesome Love

Remember My Name

Fireworks

A Burning Hill

Texas Reznikoff

Townie

Francis Forever

Carry Me Out

Goodbye, My Danish Sweetheart

Brand New City

Abbey

Both/either/interchangeable

Heat Lightning

Geyser

Come Into The Water

Pink in the Night

Two Slow Dancers

Once More to See You

anything not listed has been given careful consideration but would be too much of a reach to apply to them and/or is too personally about experiences of the human condition mitski herself has lived

Im open to healthy debate on any of these but just know i come armed with explanations for all

[thirtheenprimes]

Groups of characters that are all boys and two girls suck. Sometimes it's 2 boys and 2 girls and then it's OK I guess. Doesn't stop me from enjoying the media, and loving the characters, but here in the year 2022, why do we still have so much media (popular media specifically, and this is important) with 2-girl-2-or-more-boy groups?

That's not the point. The point is: it's become more common for trans characters to exist/be explicit. Outside of canon, in fanon, characters have been headcanoned as trans for a while. Love it. All four it. At the end of the day, all these characters being trans is more important than my complaint.

Whatever. The point: it is usually one of the 2 girls that ends up being trans, skewing the gender ratio in the group even more. Imo it doesn't matter to any one specific media what their gender ratio is, but when it happens that we now only have one girl in a group of 3+ boys, my enjoyment of the media goes down a little bit. Not a lot! Still love it because I don't understand gender anyways, I'm agender, can't wrap my head around it, but I view this progressive media as having something in common with older movies/books/whatever back when the cast was all male with a token female. Usually the token girl isn't as much a disrespectful stereotype like she used to be, but my autistic brain says, "Why only one pretty lady?"

Because I'm posting this without waiting to compile a list, I'm just going to say the 2 I can think of at the moment that made me post this.

Umbrella Academy (I love Elliot Page, his character transitioned because he did so my frustration of making Alison the only girl in the sibling group is flimsy and doesn't really hold up any more than if there had been a more even divide of genders to begin with there would be less of a dramatic ratio within the Umbrellas. Yes, I know Klaus is nonbinary, but that still leaves 5:1:1 gender ratio in favor of the boys)

Homestuck (get the fuck out of here with your psychic damage or 'what did you expect to it's homestuck shitty blah blah I LIKE Homestuck. This one is also flimsy because in the epilogues when Roxy transitioned to nonbinary, masc-presenting, I absolutely loved it but was a little uncomfortable about it. Now I realized it's because I related to Roxy most out of all characters and I was on the edge of doing exactly as they would (using they because even though I do love he-pronoun Roxy he is not canon and only partly relevant and Roxy does use They/Them sometimes, and with all the time stuff being relevant I'm going after the average) and I didn't need to be called out like that before my egg hatched/broke/whatever.

*John is June now, it went the other way with the Beta kids, that balances things out again and I LOVE June. The other character I related to so much was him, and my gender is somewhere between all versions of John/June/Roxy.

Again, my complaint is not that I want less trans boys in media or fandom, I just want more trans girls and genderqueer characters. Fuck it. No one is cis now.

[kennethmlanedc]

Is Investing in the Stock Market Gambling?

Now and then, I hear someone say that stock market investing is gambling. Is this true or false?

A good friend of mine, with the stock trading alias of the Lone Ranger, told me that her relative said investing in Penny Stocks is gambling.

Gambling is, by definition, the activity or practice of playing a game of chance for money or other stakes.

Let’s take a step back, this implication, that investing in the stock market is gambling, is often a sentiment expressed by people who believe that making money is not likely. The result for most people will be a loss. Furthermore, there may be little basis for a sound investment in some stocks, such as penny stocks, since investing theory indicates that a company’s financials may not be in line with a sound business model.

The points above are somewhat reflected in the paper titled, “Who Gambles in the Stock Market?” by Alok Kumar.[1]

In the paper, Kumar identifies lottery-type stocks by using lottery tickets (the most common form of gambling) as a reference. Lottery tickets have very low prices relative to a high potential payoff. They have low negative expected returns, and the prize distribution has exceptionally high variance.  Most importantly, they have a minuscule probability of a huge reward and a huge chance of a small loss.

To identify lottery-type stocks, Kumar characterizes stocks with low prices, high volatility, and investor sentiment skewness. The author has more precise terms that many people have never seen before. 

For example, he uses the term idiosyncratic volatility where Investopedia defines idiosyncratic risk in the following way:

“Idiosyncratic risk refers to the inherent factors that can negatively impact individual securities or a very specific group of assets. The opposite of Idiosyncratic risk is a systematic risk, which refers to broader trends that impact the overall financial system or a very broad market.”[2]

In other words, there may be high volatility of oil company security due to pipeline breaks. This may result in an adverse price move. Conversely, if a large oil field is discovered, this may cause a positive price move. The result is the high volatility of the stock price. When these events happen for a particular company more than once, there may be a skewed perception of the company unrelated to the company’s fundamentals. People may invest in them thinking that the large moves will happen again, especially if it’s a low priced stock, AKA Penny Stock.

Interestingly enough, Kumar’s paper does have a table that characterizes lottery-type stocks. Table 2, titled Basic Characteristics Of Lottery-Type Stocks, reports that there are 1500 lottery-type stocks, 1500 non-lottery-type stocks, and 9000 stocks in the middle.

So what are the characteristics of a lottery-type stock? 

The table reports that the firm size average is very low with an average market capitalization of 31 million,  low institutional ownership at 7.35%, a relatively high book to market ratio 0.681, and lower liquidity. These stocks are also younger, with a mean age of about six years. They have low analyst coverage, most don’t have dividends, they have significantly higher volatility, higher skewness, and lower prices. 

The author goes on to report that lottery-type stocks are concentrated heavily in the energy, mining, financial services, biotechnology, and technology sectors and the lowest concentration of lottery stocks is in the utilities, consumer goods, and restaurant sectors.

Given the fact that there are lottery-type stocks and non-lottery-type stocks, how likely, in general, is a trader or investor to make money in the Stock market? Remember the sentiment we discussed earlier, that most people lose money in the stock market, which is similar to the feature of lottery tickets with their negative expected return.

According to the Tradeciety:

“Profitable day traders make up a small proportion of all traders – 1.6% in the average year. However, these day traders are very active – accounting for 12% of all day trading activity.”[3]

That doesn’t sound encouraging, but this may be a problem with trading frequently.

What about the long term, buy and hold investing as Warren Buffett does? His favorite holding period is forever.[4]

I made the most money in the stock market in paper gains when I picked outstanding diversified funds, ignored them when the market was misbehaving, and held them long term. Many famous investors have made money through the buy and hold strategy, such as Warren Buffett, Jack Bogle, John Templeton, Peter Lynch, and Benjamin Graham.

In my opinion, market fluctuations are unpredictable most of the time. Sometimes you can see the writing on the wall; for example, the Corona crash seemed evident in my opinion. The virus itself was a surprise, though, and so was the financial crash of 2008.

The market has something going for it that favors long term investing. This may end someday, but historically the market goes up over time and always recovers from a crash. (We are almost out of the Corona Crash with the S&P and NASDAQ making new highs. We are waiting on the DOW which is close).  In my book Crash Proof Your Investment, I developed a historical histogram chart that shows this favoritism.

The vertical axis may look confusing. What does it mean? 

I calculated the rolling annualized returns by using one year of data.  But the annual return is calculated for each market day, so the one year of data slides like a window to collect a new day and dispense of an old one. There were 251 trading days in 2018, which means there are 251 annual return values.  

Over 105 years, there are about 26,355 (251 x 105 = 26,355) annual return values. 

The horizontal axis depicts the annual percentage gain. By looking at the 0 percent annual bar, you can see that 0 percent annual return happened a little less than 3,000 times in 105 years.

Disappointing returns for the long investor!

More importantly, the graph shows that the market has positive returns more frequently because the bulk of the bars in the graph are above 0 percent annual return. 

The market is skewed! Five percent, ten percent, and fifteen percent annual returns are the most frequent. 

There are even some outliers at a 70 percent annual return and above.

To put these numbers in perspective, let’s answer the question: How long will it take an investment to double in the market?

The average return was 9 percent? If we assume that is the fixed rate of return for every year that the investment is in the market, then we can use the Rule of 72 to answer the question.

The Rule of 72 is an equation that provides you with the length of time an investment will take to double. In our case we would divide 72 by our fixed rate of 9.

Our answer shows us it will double every eight years. Impressive!

If the graph is still confusing, there is still hope. Check out the excellent article on Investopedia called “Rolling Return.”[5]

A more familiar chart is the one shown below:

The trend is undoubtedly up. So this indicates that there may be something to buy and hold for the long term.

Finally, from the paper by Kumar, four-factor models for the stock market return are mentioned. A somewhat simplified explanation of this model is in the Investopedia article titled, Fama and French Three-Factor Model[6]. The article states that:

“Nobel Laureate Eugene Fama and researcher Kenneth French, former professors at the University of Chicago Booth School of Business, attempted to better measure market returns and, through research, found that value stocks outperform growth stocks. Similarly, small-cap stocks tend to outperform large-cap stocks. As an evaluation tool, the performance of portfolios with a large number of small-cap or value stocks would be lower than the CAPM result, as the Three-Factor Model adjusts downward for observed small-cap and value stock out-performance.”[7]

Later on the article reports:

“Fama and French highlighted that investors must be able to ride out the extra short-term volatility and periodic underperformance that could occur in a short time. Investors with a long-term time horizon of 15 years or more will be rewarded for losses suffered in the short term. Using thousands of random stock portfolios, Fama and French conducted studies to test their model and found that when size and value factors are combined with the beta factor, they could then explain as much as 95% of the return in a diversified stock portfolio.”[8]

So as you can see from the Investopedia article and the work of Fama and French, long term investing offsets short term losses that a day trader or short term trader might experience.

In the book Intelligent investor, which is one of the seeds of Warren Buffett’s massive fortune, there is commentary from Zweig’s section that says

“Like casino gambling or betting on the horses, speculating in the market can be exciting or even rewarding (if you happen to get really lucky). But it’s the worst imaginable way to build your wealth.  That’s because Wall Street, like Las Vegas or the racetrack, has calibrated the odds so that the house always prevails, in the end, against everyone who tries to beat the house at its own speculative game.

On the other hand, investing is a kind of a unique kind of casino—one where you cannot lose in the end, so long as you play only by the rules that put the odds squarely in your favor.  People who invest make money for themselves; people who speculate make money for their brokers. And that, in turn, is why Wall Street perennially downplays the durable virtues of investing and hypes the gaudy appeal of speculation.”[9]

In summary, we have discovered that there are lottery-type stocks that resemble gambling in the stock market and there are investing strategies where the outcome is more likely to be profitable. So investing in the stock market is not gambling—keyword investing. But there are plenty of opportunities to gamble with securities in the stock market. These tend to be, but are not limited to, penny stocks.

That’s all for now; good luck with your financial goals,

Dr. Paul Keller.

The Financial Master Series Books

Crash Proof Your Investment

The Beginner’s Guide to Rental Property Investing

Stock Market Masters

Notes:

[1]Kumar, Alok. “Who Gambles in the Stock Market?” The Journal of Finance 64, no. 4 (2009): 1889-933. Accessed September 14, 2020. http://www.jstor.org/stable/27735154.

[2] https://www.investopedia.com/terms/i/idiosyncraticrisk.asp

[3] https://www.tradeciety.com/24-statistics-why-most-traders-lose-money/

[4] https://www.montycampbell.com/article/what-warren-buffett-really-means-when-he-says-his-favorite-holding-period-is-forever/

[5] Chen, J. (2020, January 29). Rolling Returns Definition. Retrieved from https://www.investopedia.com/terms/r/rollingreturns.asp.

[6] https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp

[7] https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp

[8] https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp

[9] Benjamin Graham, Intelligent Investor.

Bibliography:

Campbell, M. (2018, February 03). What Warren Buffett Really Means When He Says His Favorite Holding Period Is “Forever”! Retrieved September 14, 2020, from https://www.montycampbell.com/article/what-warren-buffett-really-means-when-he-says-his-favorite-holding-period-is-forever/

Chen, J. (2020, April 23). Idiosyncratic Risk: Why a Specific Stock Is Risky Right Now. Retrieved September 14, 2020, from https://www.investopedia.com/terms/i/idiosyncraticrisk.asp

Graham, B., & Zweig, J. (2003). The intelligent investor: A book of practical counsel. NY, NY: HarperBusiness.

Hayes, A. (2020, March 05). Fama and French Three Factor Model Definition. Retrieved September 14, 2020, from https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp

Hayes, A. (2020, March 05). Fama and French Three Factor Model Definition. Retrieved September 14, 2020, from https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp

Hayes, A. (2020, March 05). Fama and French Three Factor Model Definition. Retrieved September 14, 2020, from https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp

Kumar, Alok. “Who Gambles in the Stock Market?” The Journal of Finance 64, no. 4 (2009): 1889-933. Accessed September 14, 2020. http://www.jstor.org/stable/27735154

Rolf, Witbooi, Mataruse, M., Sm, Anonymous, Burguet, M., & Ahmad. (2020, April 10). Why Most Traders Lose Money – 24 Surprising Statistics. Retrieved September 14, 2020, from https://www.tradeciety.com/24-statistics-why-most-traders-lose-money

#stocks #stockmarket #investment #investing #realestate #trading #dalio #minervini #warrenbuffett #valueinvesting #author #financialmaster #habits #stockmarketcrash #rentalproperty

source https://drpaulkeller.com/gambling-stocks/ source https://drpaulkeller.blogspot.com/2020/09/is-investing-in-stock-market-gambling.html

[marthadreyes89]

Is Investing in the Stock Market Gambling?

Now and then, I hear someone say that stock market investing is gambling. Is this true or false?

A good friend of mine, with the stock trading alias of the Lone Ranger, told me that her relative said investing in Penny Stocks is gambling.

Gambling is, by definition, the activity or practice of playing a game of chance for money or other stakes.

Let’s take a step back, this implication, that investing in the stock market is gambling, is often a sentiment expressed by people who believe that making money is not likely. The result for most people will be a loss. Furthermore, there may be little basis for a sound investment in some stocks, such as penny stocks, since investing theory indicates that a company’s financials may not be in line with a sound business model.

The points above are somewhat reflected in the paper titled, “Who Gambles in the Stock Market?” by Alok Kumar.[1]

In the paper, Kumar identifies lottery-type stocks by using lottery tickets (the most common form of gambling) as a reference. Lottery tickets have very low prices relative to a high potential payoff. They have low negative expected returns, and the prize distribution has exceptionally high variance.  Most importantly, they have a minuscule probability of a huge reward and a huge chance of a small loss.

To identify lottery-type stocks, Kumar characterizes stocks with low prices, high volatility, and investor sentiment skewness. The author has more precise terms that many people have never seen before. 

For example, he uses the term idiosyncratic volatility where Investopedia defines idiosyncratic risk in the following way:

“Idiosyncratic risk refers to the inherent factors that can negatively impact individual securities or a very specific group of assets. The opposite of Idiosyncratic risk is a systematic risk, which refers to broader trends that impact the overall financial system or a very broad market.”[2]

In other words, there may be high volatility of oil company security due to pipeline breaks. This may result in an adverse price move. Conversely, if a large oil field is discovered, this may cause a positive price move. The result is the high volatility of the stock price. When these events happen for a particular company more than once, there may be a skewed perception of the company unrelated to the company’s fundamentals. People may invest in them thinking that the large moves will happen again, especially if it’s a low priced stock, AKA Penny Stock.

Interestingly enough, Kumar’s paper does have a table that characterizes lottery-type stocks. Table 2, titled Basic Characteristics Of Lottery-Type Stocks, reports that there are 1500 lottery-type stocks, 1500 non-lottery-type stocks, and 9000 stocks in the middle.

So what are the characteristics of a lottery-type stock? 

The table reports that the firm size average is very low with an average market capitalization of 31 million,  low institutional ownership at 7.35%, a relatively high book to market ratio 0.681, and lower liquidity. These stocks are also younger, with a mean age of about six years. They have low analyst coverage, most don’t have dividends, they have significantly higher volatility, higher skewness, and lower prices. 

The author goes on to report that lottery-type stocks are concentrated heavily in the energy, mining, financial services, biotechnology, and technology sectors and the lowest concentration of lottery stocks is in the utilities, consumer goods, and restaurant sectors.

Given the fact that there are lottery-type stocks and non-lottery-type stocks, how likely, in general, is a trader or investor to make money in the Stock market? Remember the sentiment we discussed earlier, that most people lose money in the stock market, which is similar to the feature of lottery tickets with their negative expected return.

According to the Tradeciety:

“Profitable day traders make up a small proportion of all traders – 1.6% in the average year. However, these day traders are very active – accounting for 12% of all day trading activity.”[3]

That doesn’t sound encouraging, but this may be a problem with trading frequently.

What about the long term, buy and hold investing as Warren Buffett does? His favorite holding period is forever.[4]

I made the most money in the stock market in paper gains when I picked outstanding diversified funds, ignored them when the market was misbehaving, and held them long term. Many famous investors have made money through the buy and hold strategy, such as Warren Buffett, Jack Bogle, John Templeton, Peter Lynch, and Benjamin Graham.

In my opinion, market fluctuations are unpredictable most of the time. Sometimes you can see the writing on the wall; for example, the Corona crash seemed evident in my opinion. The virus itself was a surprise, though, and so was the financial crash of 2008.

The market has something going for it that favors long term investing. This may end someday, but historically the market goes up over time and always recovers from a crash. (We are almost out of the Corona Crash with the S&P and NASDAQ making new highs. We are waiting on the DOW which is close).  In my book Crash Proof Your Investment, I developed a historical histogram chart that shows this favoritism.

The vertical axis may look confusing. What does it mean? 

I calculated the rolling annualized returns by using one year of data.  But the annual return is calculated for each market day, so the one year of data slides like a window to collect a new day and dispense of an old one. There were 251 trading days in 2018, which means there are 251 annual return values.  

Over 105 years, there are about 26,355 (251 x 105 = 26,355) annual return values. 

The horizontal axis depicts the annual percentage gain. By looking at the 0 percent annual bar, you can see that 0 percent annual return happened a little less than 3,000 times in 105 years.

Disappointing returns for the long investor!

More importantly, the graph shows that the market has positive returns more frequently because the bulk of the bars in the graph are above 0 percent annual return. 

The market is skewed! Five percent, ten percent, and fifteen percent annual returns are the most frequent. 

There are even some outliers at a 70 percent annual return and above.

To put these numbers in perspective, let’s answer the question: How long will it take an investment to double in the market?

The average return was 9 percent? If we assume that is the fixed rate of return for every year that the investment is in the market, then we can use the Rule of 72 to answer the question.

The Rule of 72 is an equation that provides you with the length of time an investment will take to double. In our case we would divide 72 by our fixed rate of 9.

Our answer shows us it will double every eight years. Impressive!

If the graph is still confusing, there is still hope. Check out the excellent article on Investopedia called “Rolling Return.”[5]

A more familiar chart is the one shown below:

The trend is undoubtedly up. So this indicates that there may be something to buy and hold for the long term.

Finally, from the paper by Kumar, four-factor models for the stock market return are mentioned. A somewhat simplified explanation of this model is in the Investopedia article titled, Fama and French Three-Factor Model[6]. The article states that:

“Nobel Laureate Eugene Fama and researcher Kenneth French, former professors at the University of Chicago Booth School of Business, attempted to better measure market returns and, through research, found that value stocks outperform growth stocks. Similarly, small-cap stocks tend to outperform large-cap stocks. As an evaluation tool, the performance of portfolios with a large number of small-cap or value stocks would be lower than the CAPM result, as the Three-Factor Model adjusts downward for observed small-cap and value stock out-performance.”[7]

Later on the article reports:

“Fama and French highlighted that investors must be able to ride out the extra short-term volatility and periodic underperformance that could occur in a short time. Investors with a long-term time horizon of 15 years or more will be rewarded for losses suffered in the short term. Using thousands of random stock portfolios, Fama and French conducted studies to test their model and found that when size and value factors are combined with the beta factor, they could then explain as much as 95% of the return in a diversified stock portfolio.”[8]

So as you can see from the Investopedia article and the work of Fama and French, long term investing offsets short term losses that a day trader or short term trader might experience.

In the book Intelligent investor, which is one of the seeds of Warren Buffett’s massive fortune, there is commentary from Zweig’s section that says

“Like casino gambling or betting on the horses, speculating in the market can be exciting or even rewarding (if you happen to get really lucky). But it’s the worst imaginable way to build your wealth.  That’s because Wall Street, like Las Vegas or the racetrack, has calibrated the odds so that the house always prevails, in the end, against everyone who tries to beat the house at its own speculative game.

On the other hand, investing is a kind of a unique kind of casino—one where you cannot lose in the end, so long as you play only by the rules that put the odds squarely in your favor.  People who invest make money for themselves; people who speculate make money for their brokers. And that, in turn, is why Wall Street perennially downplays the durable virtues of investing and hypes the gaudy appeal of speculation.”[9]

In summary, we have discovered that there are lottery-type stocks that resemble gambling in the stock market and there are investing strategies where the outcome is more likely to be profitable. So investing in the stock market is not gambling—keyword investing. But there are plenty of opportunities to gamble with securities in the stock market. These tend to be, but are not limited to, penny stocks.

That’s all for now; good luck with your financial goals,

Dr. Paul Keller.

The Financial Master Series Books

Crash Proof Your Investment

The Beginner’s Guide to Rental Property Investing

Stock Market Masters

Notes:

[1]Kumar, Alok. “Who Gambles in the Stock Market?” The Journal of Finance 64, no. 4 (2009): 1889-933. Accessed September 14, 2020. http://www.jstor.org/stable/27735154.

[2] https://www.investopedia.com/terms/i/idiosyncraticrisk.asp

[3] https://www.tradeciety.com/24-statistics-why-most-traders-lose-money/

[4] https://www.montycampbell.com/article/what-warren-buffett-really-means-when-he-says-his-favorite-holding-period-is-forever/

[5] Chen, J. (2020, January 29). Rolling Returns Definition. Retrieved from https://www.investopedia.com/terms/r/rollingreturns.asp.

[6] https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp

[7] https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp

[8] https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp

[9] Benjamin Graham, Intelligent Investor.

Bibliography:

Campbell, M. (2018, February 03). What Warren Buffett Really Means When He Says His Favorite Holding Period Is “Forever”! Retrieved September 14, 2020, from https://www.montycampbell.com/article/what-warren-buffett-really-means-when-he-says-his-favorite-holding-period-is-forever/

Chen, J. (2020, April 23). Idiosyncratic Risk: Why a Specific Stock Is Risky Right Now. Retrieved September 14, 2020, from https://www.investopedia.com/terms/i/idiosyncraticrisk.asp

Graham, B., & Zweig, J. (2003). The intelligent investor: A book of practical counsel. NY, NY: HarperBusiness.

Hayes, A. (2020, March 05). Fama and French Three Factor Model Definition. Retrieved September 14, 2020, from https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp

Hayes, A. (2020, March 05). Fama and French Three Factor Model Definition. Retrieved September 14, 2020, from https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp

Hayes, A. (2020, March 05). Fama and French Three Factor Model Definition. Retrieved September 14, 2020, from https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp

Kumar, Alok. “Who Gambles in the Stock Market?” The Journal of Finance 64, no. 4 (2009): 1889-933. Accessed September 14, 2020. http://www.jstor.org/stable/27735154

Rolf, Witbooi, Mataruse, M., Sm, Anonymous, Burguet, M., & Ahmad. (2020, April 10). Why Most Traders Lose Money – 24 Surprising Statistics. Retrieved September 14, 2020, from https://www.tradeciety.com/24-statistics-why-most-traders-lose-money

#stocks #stockmarket #investment #investing #realestate #trading #dalio #minervini #warrenbuffett #valueinvesting #author #financialmaster #habits #stockmarketcrash #rentalproperty

source https://drpaulkeller.com/gambling-stocks/ source https://drpaulkeller2.tumblr.com/post/629298460450029569

[drpaulkeller2]

Is Investing in the Stock Market Gambling?

Now and then, I hear someone say that stock market investing is gambling. Is this true or false?

A good friend of mine, with the stock trading alias of the Lone Ranger, told me that her relative said investing in Penny Stocks is gambling.

Gambling is, by definition, the activity or practice of playing a game of chance for money or other stakes.

Let’s take a step back, this implication, that investing in the stock market is gambling, is often a sentiment expressed by people who believe that making money is not likely. The result for most people will be a loss. Furthermore, there may be little basis for a sound investment in some stocks, such as penny stocks, since investing theory indicates that a company’s financials may not be in line with a sound business model.

The points above are somewhat reflected in the paper titled, “Who Gambles in the Stock Market?” by Alok Kumar.[1]

In the paper, Kumar identifies lottery-type stocks by using lottery tickets (the most common form of gambling) as a reference. Lottery tickets have very low prices relative to a high potential payoff. They have low negative expected returns, and the prize distribution has exceptionally high variance.  Most importantly, they have a minuscule probability of a huge reward and a huge chance of a small loss.

To identify lottery-type stocks, Kumar characterizes stocks with low prices, high volatility, and investor sentiment skewness. The author has more precise terms that many people have never seen before. 

For example, he uses the term idiosyncratic volatility where Investopedia defines idiosyncratic risk in the following way:

“Idiosyncratic risk refers to the inherent factors that can negatively impact individual securities or a very specific group of assets. The opposite of Idiosyncratic risk is a systematic risk, which refers to broader trends that impact the overall financial system or a very broad market.”[2]

In other words, there may be high volatility of oil company security due to pipeline breaks. This may result in an adverse price move. Conversely, if a large oil field is discovered, this may cause a positive price move. The result is the high volatility of the stock price. When these events happen for a particular company more than once, there may be a skewed perception of the company unrelated to the company’s fundamentals. People may invest in them thinking that the large moves will happen again, especially if it’s a low priced stock, AKA Penny Stock.

Interestingly enough, Kumar’s paper does have a table that characterizes lottery-type stocks. Table 2, titled Basic Characteristics Of Lottery-Type Stocks, reports that there are 1500 lottery-type stocks, 1500 non-lottery-type stocks, and 9000 stocks in the middle.

So what are the characteristics of a lottery-type stock? 

The table reports that the firm size average is very low with an average market capitalization of 31 million,  low institutional ownership at 7.35%, a relatively high book to market ratio 0.681, and lower liquidity. These stocks are also younger, with a mean age of about six years. They have low analyst coverage, most don’t have dividends, they have significantly higher volatility, higher skewness, and lower prices. 

The author goes on to report that lottery-type stocks are concentrated heavily in the energy, mining, financial services, biotechnology, and technology sectors and the lowest concentration of lottery stocks is in the utilities, consumer goods, and restaurant sectors.

Given the fact that there are lottery-type stocks and non-lottery-type stocks, how likely, in general, is a trader or investor to make money in the Stock market? Remember the sentiment we discussed earlier, that most people lose money in the stock market, which is similar to the feature of lottery tickets with their negative expected return.

According to the Tradeciety:

“Profitable day traders make up a small proportion of all traders – 1.6% in the average year. However, these day traders are very active – accounting for 12% of all day trading activity.”[3]

That doesn’t sound encouraging, but this may be a problem with trading frequently.

What about the long term, buy and hold investing as Warren Buffett does? His favorite holding period is forever.[4]

I made the most money in the stock market in paper gains when I picked outstanding diversified funds, ignored them when the market was misbehaving, and held them long term. Many famous investors have made money through the buy and hold strategy, such as Warren Buffett, Jack Bogle, John Templeton, Peter Lynch, and Benjamin Graham.

In my opinion, market fluctuations are unpredictable most of the time. Sometimes you can see the writing on the wall; for example, the Corona crash seemed evident in my opinion. The virus itself was a surprise, though, and so was the financial crash of 2008.

The market has something going for it that favors long term investing. This may end someday, but historically the market goes up over time and always recovers from a crash. (We are almost out of the Corona Crash with the S&P and NASDAQ making new highs. We are waiting on the DOW which is close).  In my book Crash Proof Your Investment, I developed a historical histogram chart that shows this favoritism.

The vertical axis may look confusing. What does it mean? 

I calculated the rolling annualized returns by using one year of data.  But the annual return is calculated for each market day, so the one year of data slides like a window to collect a new day and dispense of an old one. There were 251 trading days in 2018, which means there are 251 annual return values.  

Over 105 years, there are about 26,355 (251 x 105 = 26,355) annual return values. 

The horizontal axis depicts the annual percentage gain. By looking at the 0 percent annual bar, you can see that 0 percent annual return happened a little less than 3,000 times in 105 years.

Disappointing returns for the long investor!

More importantly, the graph shows that the market has positive returns more frequently because the bulk of the bars in the graph are above 0 percent annual return. 

The market is skewed! Five percent, ten percent, and fifteen percent annual returns are the most frequent. 

There are even some outliers at a 70 percent annual return and above.

To put these numbers in perspective, let’s answer the question: How long will it take an investment to double in the market?

The average return was 9 percent? If we assume that is the fixed rate of return for every year that the investment is in the market, then we can use the Rule of 72 to answer the question.

The Rule of 72 is an equation that provides you with the length of time an investment will take to double. In our case we would divide 72 by our fixed rate of 9.

Our answer shows us it will double every eight years. Impressive!

If the graph is still confusing, there is still hope. Check out the excellent article on Investopedia called “Rolling Return.”[5]

A more familiar chart is the one shown below:

The trend is undoubtedly up. So this indicates that there may be something to buy and hold for the long term.

Finally, from the paper by Kumar, four-factor models for the stock market return are mentioned. A somewhat simplified explanation of this model is in the Investopedia article titled, Fama and French Three-Factor Model[6]. The article states that:

“Nobel Laureate Eugene Fama and researcher Kenneth French, former professors at the University of Chicago Booth School of Business, attempted to better measure market returns and, through research, found that value stocks outperform growth stocks. Similarly, small-cap stocks tend to outperform large-cap stocks. As an evaluation tool, the performance of portfolios with a large number of small-cap or value stocks would be lower than the CAPM result, as the Three-Factor Model adjusts downward for observed small-cap and value stock out-performance.”[7]

Later on the article reports:

“Fama and French highlighted that investors must be able to ride out the extra short-term volatility and periodic underperformance that could occur in a short time. Investors with a long-term time horizon of 15 years or more will be rewarded for losses suffered in the short term. Using thousands of random stock portfolios, Fama and French conducted studies to test their model and found that when size and value factors are combined with the beta factor, they could then explain as much as 95% of the return in a diversified stock portfolio.”[8]

So as you can see from the Investopedia article and the work of Fama and French, long term investing offsets short term losses that a day trader or short term trader might experience.

In the book Intelligent investor, which is one of the seeds of Warren Buffett’s massive fortune, there is commentary from Zweig’s section that says

“Like casino gambling or betting on the horses, speculating in the market can be exciting or even rewarding (if you happen to get really lucky). But it’s the worst imaginable way to build your wealth.  That’s because Wall Street, like Las Vegas or the racetrack, has calibrated the odds so that the house always prevails, in the end, against everyone who tries to beat the house at its own speculative game.

On the other hand, investing is a kind of a unique kind of casino—one where you cannot lose in the end, so long as you play only by the rules that put the odds squarely in your favor.  People who invest make money for themselves; people who speculate make money for their brokers. And that, in turn, is why Wall Street perennially downplays the durable virtues of investing and hypes the gaudy appeal of speculation.”[9]

In summary, we have discovered that there are lottery-type stocks that resemble gambling in the stock market and there are investing strategies where the outcome is more likely to be profitable. So investing in the stock market is not gambling—keyword investing. But there are plenty of opportunities to gamble with securities in the stock market. These tend to be, but are not limited to, penny stocks.

That’s all for now; good luck with your financial goals,

Dr. Paul Keller.

The Financial Master Series Books

Crash Proof Your Investment

The Beginner’s Guide to Rental Property Investing

Stock Market Masters

Notes:

[1]Kumar, Alok. “Who Gambles in the Stock Market?” The Journal of Finance 64, no. 4 (2009): 1889-933. Accessed September 14, 2020. http://www.jstor.org/stable/27735154.

[2] https://www.investopedia.com/terms/i/idiosyncraticrisk.asp

[3] https://www.tradeciety.com/24-statistics-why-most-traders-lose-money/

[4] https://www.montycampbell.com/article/what-warren-buffett-really-means-when-he-says-his-favorite-holding-period-is-forever/

[5] Chen, J. (2020, January 29). Rolling Returns Definition. Retrieved from https://www.investopedia.com/terms/r/rollingreturns.asp.

[6] https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp

[7] https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp

[8] https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp

[9] Benjamin Graham, Intelligent Investor.

Bibliography:

Campbell, M. (2018, February 03). What Warren Buffett Really Means When He Says His Favorite Holding Period Is “Forever”! Retrieved September 14, 2020, from https://www.montycampbell.com/article/what-warren-buffett-really-means-when-he-says-his-favorite-holding-period-is-forever/

Chen, J. (2020, April 23). Idiosyncratic Risk: Why a Specific Stock Is Risky Right Now. Retrieved September 14, 2020, from https://www.investopedia.com/terms/i/idiosyncraticrisk.asp

Graham, B., & Zweig, J. (2003). The intelligent investor: A book of practical counsel. NY, NY: HarperBusiness.

Hayes, A. (2020, March 05). Fama and French Three Factor Model Definition. Retrieved September 14, 2020, from https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp

Hayes, A. (2020, March 05). Fama and French Three Factor Model Definition. Retrieved September 14, 2020, from https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp

Hayes, A. (2020, March 05). Fama and French Three Factor Model Definition. Retrieved September 14, 2020, from https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp

Kumar, Alok. “Who Gambles in the Stock Market?” The Journal of Finance 64, no. 4 (2009): 1889-933. Accessed September 14, 2020. http://www.jstor.org/stable/27735154

Rolf, Witbooi, Mataruse, M., Sm, Anonymous, Burguet, M., & Ahmad. (2020, April 10). Why Most Traders Lose Money – 24 Surprising Statistics. Retrieved September 14, 2020, from https://www.tradeciety.com/24-statistics-why-most-traders-lose-money

#stocks #stockmarket #investment #investing #realestate #trading #dalio #minervini #warrenbuffett #valueinvesting #author #financialmaster #habits #stockmarketcrash #rentalproperty

source https://drpaulkeller.com/gambling-stocks/

[josephvortiz35]

Is Investing in the Stock Market Gambling?

Now and then, I hear someone say that stock market investing is gambling. Is this true or false?

A good friend of mine, with the stock trading alias of the Lone Ranger, told me that her relative said investing in Penny Stocks is gambling.

Gambling is, by definition, the activity or practice of playing a game of chance for money or other stakes.

Let’s take a step back, this implication, that investing in the stock market is gambling, is often a sentiment expressed by people who believe that making money is not likely. The result for most people will be a loss. Furthermore, there may be little basis for a sound investment in some stocks, such as penny stocks, since investing theory indicates that a company’s financials may not be in line with a sound business model.

The points above are somewhat reflected in the paper titled, “Who Gambles in the Stock Market?” by Alok Kumar.[1]

In the paper, Kumar identifies lottery-type stocks by using lottery tickets (the most common form of gambling) as a reference. Lottery tickets have very low prices relative to a high potential payoff. They have low negative expected returns, and the prize distribution has exceptionally high variance.  Most importantly, they have a minuscule probability of a huge reward and a huge chance of a small loss.

To identify lottery-type stocks, Kumar characterizes stocks with low prices, high volatility, and investor sentiment skewness. The author has more precise terms that many people have never seen before. 

For example, he uses the term idiosyncratic volatility where Investopedia defines idiosyncratic risk in the following way:

“Idiosyncratic risk refers to the inherent factors that can negatively impact individual securities or a very specific group of assets. The opposite of Idiosyncratic risk is a systematic risk, which refers to broader trends that impact the overall financial system or a very broad market.”[2]

In other words, there may be high volatility of oil company security due to pipeline breaks. This may result in an adverse price move. Conversely, if a large oil field is discovered, this may cause a positive price move. The result is the high volatility of the stock price. When these events happen for a particular company more than once, there may be a skewed perception of the company unrelated to the company’s fundamentals. People may invest in them thinking that the large moves will happen again, especially if it’s a low priced stock, AKA Penny Stock.

Interestingly enough, Kumar’s paper does have a table that characterizes lottery-type stocks. Table 2, titled Basic Characteristics Of Lottery-Type Stocks, reports that there are 1500 lottery-type stocks, 1500 non-lottery-type stocks, and 9000 stocks in the middle.

So what are the characteristics of a lottery-type stock? 

The table reports that the firm size average is very low with an average market capitalization of 31 million,  low institutional ownership at 7.35%, a relatively high book to market ratio 0.681, and lower liquidity. These stocks are also younger, with a mean age of about six years. They have low analyst coverage, most don’t have dividends, they have significantly higher volatility, higher skewness, and lower prices. 

The author goes on to report that lottery-type stocks are concentrated heavily in the energy, mining, financial services, biotechnology, and technology sectors and the lowest concentration of lottery stocks is in the utilities, consumer goods, and restaurant sectors.

Given the fact that there are lottery-type stocks and non-lottery-type stocks, how likely, in general, is a trader or investor to make money in the Stock market? Remember the sentiment we discussed earlier, that most people lose money in the stock market, which is similar to the feature of lottery tickets with their negative expected return.

According to the Tradeciety:

“Profitable day traders make up a small proportion of all traders – 1.6% in the average year. However, these day traders are very active – accounting for 12% of all day trading activity.”[3]

That doesn’t sound encouraging, but this may be a problem with trading frequently.

What about the long term, buy and hold investing as Warren Buffett does? His favorite holding period is forever.[4]

I made the most money in the stock market in paper gains when I picked outstanding diversified funds, ignored them when the market was misbehaving, and held them long term. Many famous investors have made money through the buy and hold strategy, such as Warren Buffett, Jack Bogle, John Templeton, Peter Lynch, and Benjamin Graham.

In my opinion, market fluctuations are unpredictable most of the time. Sometimes you can see the writing on the wall; for example, the Corona crash seemed evident in my opinion. The virus itself was a surprise, though, and so was the financial crash of 2008.

The market has something going for it that favors long term investing. This may end someday, but historically the market goes up over time and always recovers from a crash. (We are almost out of the Corona Crash with the S&P and NASDAQ making new highs. We are waiting on the DOW which is close).  In my book Crash Proof Your Investment, I developed a historical histogram chart that shows this favoritism.

The vertical axis may look confusing. What does it mean? 

I calculated the rolling annualized returns by using one year of data.  But the annual return is calculated for each market day, so the one year of data slides like a window to collect a new day and dispense of an old one. There were 251 trading days in 2018, which means there are 251 annual return values.  

Over 105 years, there are about 26,355 (251 x 105 = 26,355) annual return values. 

The horizontal axis depicts the annual percentage gain. By looking at the 0 percent annual bar, you can see that 0 percent annual return happened a little less than 3,000 times in 105 years.

Disappointing returns for the long investor!

More importantly, the graph shows that the market has positive returns more frequently because the bulk of the bars in the graph are above 0 percent annual return. 

The market is skewed! Five percent, ten percent, and fifteen percent annual returns are the most frequent. 

There are even some outliers at a 70 percent annual return and above.

To put these numbers in perspective, let’s answer the question: How long will it take an investment to double in the market?

The average return was 9 percent? If we assume that is the fixed rate of return for every year that the investment is in the market, then we can use the Rule of 72 to answer the question.

The Rule of 72 is an equation that provides you with the length of time an investment will take to double. In our case we would divide 72 by our fixed rate of 9.

Our answer shows us it will double every eight years. Impressive!

If the graph is still confusing, there is still hope. Check out the excellent article on Investopedia called “Rolling Return.”[5]

A more familiar chart is the one shown below:

The trend is undoubtedly up. So this indicates that there may be something to buy and hold for the long term.

Finally, from the paper by Kumar, four-factor models for the stock market return are mentioned. A somewhat simplified explanation of this model is in the Investopedia article titled, Fama and French Three-Factor Model[6]. The article states that:

“Nobel Laureate Eugene Fama and researcher Kenneth French, former professors at the University of Chicago Booth School of Business, attempted to better measure market returns and, through research, found that value stocks outperform growth stocks. Similarly, small-cap stocks tend to outperform large-cap stocks. As an evaluation tool, the performance of portfolios with a large number of small-cap or value stocks would be lower than the CAPM result, as the Three-Factor Model adjusts downward for observed small-cap and value stock out-performance.”[7]

Later on the article reports:

“Fama and French highlighted that investors must be able to ride out the extra short-term volatility and periodic underperformance that could occur in a short time. Investors with a long-term time horizon of 15 years or more will be rewarded for losses suffered in the short term. Using thousands of random stock portfolios, Fama and French conducted studies to test their model and found that when size and value factors are combined with the beta factor, they could then explain as much as 95% of the return in a diversified stock portfolio.”[8]

So as you can see from the Investopedia article and the work of Fama and French, long term investing offsets short term losses that a day trader or short term trader might experience.

In the book Intelligent investor, which is one of the seeds of Warren Buffett’s massive fortune, there is commentary from Zweig’s section that says

“Like casino gambling or betting on the horses, speculating in the market can be exciting or even rewarding (if you happen to get really lucky). But it’s the worst imaginable way to build your wealth.  That’s because Wall Street, like Las Vegas or the racetrack, has calibrated the odds so that the house always prevails, in the end, against everyone who tries to beat the house at its own speculative game.

On the other hand, investing is a kind of a unique kind of casino—one where you cannot lose in the end, so long as you play only by the rules that put the odds squarely in your favor.  People who invest make money for themselves; people who speculate make money for their brokers. And that, in turn, is why Wall Street perennially downplays the durable virtues of investing and hypes the gaudy appeal of speculation.”[9]

In summary, we have discovered that there are lottery-type stocks that resemble gambling in the stock market and there are investing strategies where the outcome is more likely to be profitable. So investing in the stock market is not gambling—keyword investing. But there are plenty of opportunities to gamble with securities in the stock market. These tend to be, but are not limited to, penny stocks.

That’s all for now; good luck with your financial goals,

Dr. Paul Keller.

The Financial Master Series Books

Crash Proof Your Investment

The Beginner’s Guide to Rental Property Investing

Stock Market Masters

Notes:

[1]Kumar, Alok. “Who Gambles in the Stock Market?” The Journal of Finance 64, no. 4 (2009): 1889-933. Accessed September 14, 2020. http://www.jstor.org/stable/27735154.

[2] https://www.investopedia.com/terms/i/idiosyncraticrisk.asp

[3] https://www.tradeciety.com/24-statistics-why-most-traders-lose-money/

[4] https://www.montycampbell.com/article/what-warren-buffett-really-means-when-he-says-his-favorite-holding-period-is-forever/

[5] Chen, J. (2020, January 29). Rolling Returns Definition. Retrieved from https://www.investopedia.com/terms/r/rollingreturns.asp.

[6] https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp

[7] https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp

[8] https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp

[9] Benjamin Graham, Intelligent Investor.

Bibliography:

Campbell, M. (2018, February 03). What Warren Buffett Really Means When He Says His Favorite Holding Period Is “Forever”! Retrieved September 14, 2020, from https://www.montycampbell.com/article/what-warren-buffett-really-means-when-he-says-his-favorite-holding-period-is-forever/

Chen, J. (2020, April 23). Idiosyncratic Risk: Why a Specific Stock Is Risky Right Now. Retrieved September 14, 2020, from https://www.investopedia.com/terms/i/idiosyncraticrisk.asp

Graham, B., & Zweig, J. (2003). The intelligent investor: A book of practical counsel. NY, NY: HarperBusiness.

Hayes, A. (2020, March 05). Fama and French Three Factor Model Definition. Retrieved September 14, 2020, from https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp

Hayes, A. (2020, March 05). Fama and French Three Factor Model Definition. Retrieved September 14, 2020, from https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp

Hayes, A. (2020, March 05). Fama and French Three Factor Model Definition. Retrieved September 14, 2020, from https://www.investopedia.com/terms/f/famaandfrenchthreefactormodel.asp

Kumar, Alok. “Who Gambles in the Stock Market?” The Journal of Finance 64, no. 4 (2009): 1889-933. Accessed September 14, 2020. http://www.jstor.org/stable/27735154

Rolf, Witbooi, Mataruse, M., Sm, Anonymous, Burguet, M., & Ahmad. (2020, April 10). Why Most Traders Lose Money – 24 Surprising Statistics. Retrieved September 14, 2020, from https://www.tradeciety.com/24-statistics-why-most-traders-lose-money

#stocks #stockmarket #investment #investing #realestate #trading #dalio #minervini #warrenbuffett #valueinvesting #author #financialmaster #habits #stockmarketcrash #rentalproperty

from https://drpaulkeller.com/gambling-stocks/

source https://drpaulkeller.weebly.com/blog/is-investing-in-the-stock-market-gambling

[thebaesharampodcast]

Dear BAE, 

I am 35 years old and worried I will never meet the love of my life and have kids! I am smart, successful and pretty - I don’t want to sound conceited, but I’ve worked hard to get where I am! 

Some background: I am Muslim (Shia) and want to marry a Muslim despite having had horrible experiences dating Muslim men. For example, some of the Muslim men I’ve dated used my sect as an excuse it ‘wouldn’t work,’ or that their parents ‘wouldn’t accept’ me. Others didn’t seem to understand basic consent, and acted like holding hands was license to grope me! 

This just hasn’t been my experience with non-Muslim men: the ones I’ve dated seemed respectful of my cultural/religious background, wanted to learn more about me, and about what made me comfortable. When I dated non-Muslim men, I felt I was being ‘wooed’, whereas Muslim men seem to be asking, “how will YOU convince ME you’re good enough?”

Moreover, non-Muslim men I’ve dated had no problem being honest about our relationships, whereas Muslim men seem to be in denial we’re dating, or have guilt about it, claiming it’s ‘sinful,’ and that I was somehow guilty of ‘luring’ them! 

I just feel when I date Muslim men, there seems to be a power dynamic where he has more options than he can count, and I’m competing for his acceptance, like in an audition or interview. The problem is, I know I want to marry a Muslim because my faith and culture are important to me. 

Do you think there’s a way to reconcile my two realities?

Losing (my man’s) religion 

Dear Losing (my man’s) religion, 

Ugh I feel you on that anxiety over “time’s running out” - time is no one’s friend, amirite? There’s so much we want to achieve and have in a limited amount of time. What you’ve got - a career, financial stability, professional success - are things others do not. And while others may have found a partner and had kids, how many can say they’ve achieved the success you have at your age? We all have different gifts and challenges at different stages of our lives. And you have so much to be proud of and thankful for. 

That being said, I’m sorry you’ve had such disappointing experiences while searching for a Muslim partner. It must be frustrating - but more so hurtful - to be rejected based on your religious identity, and that too, from a community you consider your own. 

You are too amazing not to be swept-off-your-feet wooed in love, or worse, have your feelings ignored while being scrutinized and discriminated against! This ‘dating’ doesn’t sound fun at all. But that’s what falling in love is supposed to be - if it weren’t exhilarating, how would we be willing to dive into such excruciating vulnerability?

It sounds like you’ve had better experiences with non-Muslim men who’ve shown more respect not just for your feelings, but for your religious and cultural backgrounds as well. We can take a moment to consider why - perhaps because they’re conscious your faith and culture differ from theirs, they realize sensitivity is a prerequisite to any relationship. Muslim men on the other hand, might be taking your sectarian difference for granted, and think it’s fair game to discriminate due to an entitled sense of ‘preference’ - one forgets it’s easy to discriminate against others and chalk it up to sheer choice when one is in the majority. 

But setting the discrimination aside, you’ve also expressed disappointment with potential Muslim partners over a lack of transparency and honesty about your relationships, respect for your physical boundaries and consent, and their parental co-dependencies. 

I sympathize with your disappointment over a lack of transparency. Honesty regarding the status of your relationship - with each other, and with others - is important not just for knowing that you’re both on the same page regarding your commitment, but also for being able to talk openly about expectations in your relationship, including physical ones. How do we even begin to talk about what we’re comfortable with physically if we can’t talk about what we’re comfortable with emotionally? 

That leads to the importance of understanding consent, something even wider mainstream American culture is trying to understand in the wake of #MeToo. Muslims seem to have the added complications of guilt and denial around relationships, leaving us even more vulnerable to situations where our boundaries are violated and we don’t know how to respond.  

Also, the need for mommy and daddy’s approval is an unhealthy codependency in our community that needs to be addressed. I can’t even begin to tackle all the consequences of that dynamic in this post, but maybe in future ones!

So, you feel like you’ve been offering yourself up for scrutiny to males who’ve acted like they have the final say in sexual selection. Girlfriend, let me remind you that throughout evolutionary biology, sexual selection has relied on females! Remember that the next time you feel like you don’t have any power in this situation!

There is no reason to serve yourself up for scrutiny - you are not in an interview trying to get the job of your date’s future wife. It’s as much a place for him to get to know you as it is for you! You’re both looking to see if you’re a good fit for each other. 

Actually, it’s possible your experience with discrimination has made you feel like a second-class citizen within our community, without even being aware of it. It’s this subconscious classification that could be causing you to give your power over to someone else - something a woman as successful as yourself wouldn’t otherwise do. 

But this reversed sexual selection - that females have to compete for male selection - goes hand in hand with patriarchy. This doesn’t mean Islam is patriarchal because God has decreed it such, but rather, because the vast majority of adherents might believe it should be. 

Consider the allowed practice of polygamy. While it may not be a reality for most contemporary Muslims, it still informs the culture regarding gender statuses. Another consideration: the Muslim belief that a sign of the end of days will be a skewed gender ratio of 50 women to 1 man. (See, https://islamqa.org/hanafi/askimam/81124) 

What do these beliefs do, besides fuel paranoia that there are not enough men in the world and that women will have to compete to obtain the scarce, valued male resource? 

Recognize that this gender ratio falls flat in the face of global population stats which tell us there are currently 1.01 males to females. That means there are more men than women, and the numbers skew even higher in favor of males from birth until age 25 where it is 1.07. The male female ratio only goes down in favor of women after the age of 55, when it is 0.96 men to women. (see CIA factbook, https://www.cia.gov/library/publications/the-world-factbook/geos/xx.html). 

 That being said, would you consider pursuing more of the same good experiences you’ve had over those that may initially seem unnatural to you? For example, it sounds like you’re dating Muslim men you perhaps wouldn’t otherwise but for their “Muslim” label. These unnatural situations are indeed turning what should be fun dates into interviews that are just recipes for frustration, anxiety, and unhappiness. 

While I respect your desire to want to only marry a Muslim man, I think it’s time to consider a few things: (1) what does that really mean, and (2) if you’re not finding what you’re looking for where you’re looking for it, is it time to look elsewhere?  

First consider, what are the values you’re looking for in a partner? These are the values that are most important to YOU. There could be Muslim men who don’t have them, or non-Muslim men who do. Or non-Muslim men who are considering the Muslim faith, or actually have beliefs that are consistent with your values and faith, but are missing the label. Personally, I’ve known people in my life who didn’t call themselves Buddhist, but certainly had Buddhist beliefs, particularly about philosophies regarding ego and attachment. Is it more important what we call ourselves than what it is we practice?

All I’m saying is, don’t artificially shrink your dating pool! 

There’s a lot of pressure you’re putting on yourself here: dating should be fun, enjoy yourself! And if you’re not enjoying yourself here, find a place where you are. Why? Because you have to re-introduce yourself to the joy in dating. Your attitude towards settling down seems to be scarred by your bad experiences, and the result is that your goal of meeting a partner is clouded with doubt, fear, and anxiety. If you can replace those feelings with positive ones through positive experiences, I know you will be closer to getting what you want, and enjoy yourself along the way. 

Love, BAE

[progressiveparty]

Yes, America Is Rigged Against Workers

No other industrial country treats its working class so badly. And there’s one big reason for that.

The United States is the only advanced industrial nation that doesn’t have national laws guaranteeing paid maternity leave. It is also the only advanced economy that doesn’t guarantee workers any vacation, paid or unpaid, and the only highly developed country (other than South Korea) that doesn’t guarantee paid sick days. In contrast, the European Union’s 28 nations guarantee workers at least four weeks’ paid vacation. Among the three dozen industrial countries in the Organization for Economic Cooperation and Development, the United States has the lowest minimum wage as a percentage of the median wage — just 34 percent of the typical wage, compared with 62 percent in France and 54 percent in Britain. It also has the second-highest percentage of low-wage workers among that group, exceeded only by Latvia. All this means the United States suffers from what I call “anti-worker exceptionalism.” Academics debate why American workers are in many ways worse off than their counterparts elsewhere, but there is overriding agreement on one reason: Labor unions are weaker in the United States than in other industrial nations. Just one in 16 private-sector American workers is in a union, largely because corporations are so adept and aggressive at beating back unionization. In no other industrial nation do corporations fight so hard to keep out unions. The consequences are enormous, not only for wages and income inequality, but also for our politics and policy-making and for the many Americans who are mistreated at work.

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To be sure, unions have their flaws, from corruption to their history of racial and sex discrimination. Still, Jacob S. Hacker and Paul Pierson write of an important, unappreciated feature of unions in “Winner-Take-All Politics”: “While there are many ‘progressive’ groups in the American universe of organized interests, labor is the only major one focused on the broad economic concerns of those with modest incomes.” As workers’ power has waned, many corporations have adopted practices that were far rarer — if not unheard-of — decades ago: hiring hordes of unpaid interns, expecting workers to toil 60 or 70 hours a week, prohibiting employees from suing and instead forcing them into arbitration (which usually favors employers), and hamstringing employees’ mobility by making them sign non-compete clauses. HELP PROGRESSIVES CONTINUE TO WIN CONTRIBUTE NOW

America’s workers have for decades been losing out: year after year of wage stagnation, increased insecurity on the job, waves of downsizing and offshoring, and labor’s share of national income declining to its lowest level in seven decades. Numerous studies have found that an important cause of America’s soaring income inequality is the decline of labor unions — and the concomitant decline in workers’ ability to extract more of the profit and prosperity from the corporations they work for. The only time during the past century when income inequality narrowed substantially was the 1940s through 1970s, when unions were at their peak of power and prominence. Many Americans are understandably frustrated. That’s one reason the percentage who say they want to join a union has risen markedly. According to a 2018 M.I.T. study, 46 percent of nonunion workers say they would like to be in a union, up from 32 percent in 1995. Nonetheless, just 10.5 percent of all American workers, and only 6.4 percent of private-sector workers, are in unions.

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But this desire to unionize faces some daunting challenges. In many corporations, the mentality is that any supervisor, whether a factory manager or retail manager, who fails to keep out a union is an utter failure. That means managers fight hard to quash unions. One study found that 57 percent of employers threatened to close operations when workers sought to unionize, while 47 percent threatened to cut wages or benefits and 34 percent fired union supporters during unionization drives. Corporate executives’ frequent failure to listen to workers’ concerns — along with the intimidation of employees — can have deadly results. On April 5, 2010, a coal dust explosion killed 29 miners at Massey Energy’s Upper Big Branch coal mine in West Virginia. A federal investigation found that the mine’s ventilation system was inadequate and that explosive gases were allowed to build up. Workers at the nonunion mine knew about these dangers. “No one felt they could go to management and express their fears,” Stanley Stewart, an Upper Big Branch miner, told a congressional committee. “We knew we’d be marked men and the management would look for ways to fire us.” The diminished power of unions and workers has skewed American politics, helping give billionaires and corporations inordinate sway over America’s politics and policymaking. In the 2015-16 election cycle, business outspent labor $3.4 billion to $213 million, a ratio of 16 to 1, according to the nonpartisan Center for Responsive Politics. All of the nation’s unions, taken together, spend about $48 million a year for lobbying in Washington, while corporate America spends $3 billion. Little wonder that many lawmakers seem vastly more interested in cutting taxes on corporations than in raising the minimum wage. There were undoubtedly many reasons for Donald Trump’s 2016 victory, but a key one was that many Americans seemed to view him as a protest candidate, promising to shake up “the system” and “drain the swamp.” Many voters embraced Mr. Trump because they believed his statements that the system is rigged — and in many ways it is. When it comes to workers’ power in the workplace and in politics, the pendulum has swung far toward corporations. Reversing that won’t be easy, but it is vital we do so. There are myriad proposals to restore some balance, from having workers elect representatives to corporate boards to making it easier for workers to unionize to expanding public financing of political campaigns to prevent wealthy and corporate donors from often dominating. America’s workers won’t stop thinking the system is rigged until they feel they have an effective voice in the workplace and in policymaking so that they can share in more of the economy’s prosperity to help improve their — and their loved ones’ — lives. This Piece Originally Appeared in www.nytimes.com Read the full article

[bookedsuccess]

#DAY351

The Book “Fooled by Randomness” in Three Sentences

Summary by James Clear

Randomness, chance, and luck influence our lives and our work more than we realize. Because of hindsight bias and survivorship bias, in particular, we tend to forget the many who fail, remember the few who succeed, and then create reasons and patterns for their success even though it was largely random. Mild success can be explainable by skills and hard work, but wild success is usually attributable to variance and luck.

Fooled by Randomness summary

This is my book summary of Fooled by Randomness by Nassim Nicholas Taleb. My notes are informal and often contain quotes from the book as well as my own thoughts. This summary also includes key lessons and important passages from the book.

According to Taleb, the book's most popular chapter was Chapter 11, the one in which he compressed all the literature on the topic of miscalculating probability.

Important point: “it's more random than we think, not it is all random.” Chance favors preparedness, but it is not caused by preparedness (same for hard work, skills, etc.)

“This business of journalism is just about entertainment, particularly when it comes to radio and television.”

As much as we want to “keep it simple, stupid” … It is precisely the simplification of issues that are actually very complex, which can be dangerous.

“Things that happen with little help from luck are more resistant to randomness.”

“Mild success can be explainable by skills and labor. Wild success is attributable to variance.”

One common theory for why people pursue leadership is because of “social emotions” which cause others to be influenced by a person due to small, almost imperceptible physical signals like charisma, gestures, and gait.

This has also been shown via evolutionary psychology: when you perform well in life, you get all “puffed up” in the way you carry yourself, the bounce in your step, etc. From an evolution standpoint this is great because it becomes easier to spot the most successful / desirable mate.

The concept of alternative histories is particularly interesting. If you were to relive a set of events 1000 times, what would the range of outcomes be? If there is very little variance in your alternative histories (i.e. You chose to become a dentist and you will probably make more or less the same amount of money and live a similar lifestyle all 1000 times), then you are in a relatively non- random situation. Meanwhile, if there is a very wide range of normal results when considering 1,000 variations (entrepreneurs, traders, etc.), then it is a very random situation.

The quality of a choice cannot be judged just by the result. (I first learned this in baseball. Just because a pitch you call or play you call doesn't work out doesn't make it a poor choice. It could have been the right call, but bad luck. Or vice versa.)

“Certainty is something that is likely to take place across the highest number of different alternative histories. Uncertainty concerns events that should take place in the lowest number of them.”

You should think carefully about getting more insurance / shielding yourself from events that — although unlikely — could be catastrophic. You essentially want to insulate yourself from terrible random accidents.

We have a tendency to see risks against specific things as more likely than general risks (dying in a terrorist attack while traveling vs. dying on your next trip, even though the second includes the first). We seem to overvalue the things that trigger an emotional response and undervalue the things that aren't as emotional.

We are so mentally wired to overvalue the sensational stories that you can “realize informational gains by dispensing with the news.”

Fascinating famous Swiss study of the amnesia patient who couldn't remember doctor's name but did remember him pricking her hand with a pin.

“Every man believes that he is quite different.”

It's better to value old, distilled thoughts than “new thinking” because for an idea to last so long it must be good. That is, old ideas have had to stand the test of time. New ideas have not. Some new ideas will end up lasting, but most will not.

The ratio of undistilled information to distilled is rising. Let's call information that has never had to prove its truth more than once or twice, undistilled. And information that has been filtered through many years, counter arguments, and situations is distilled. You want more distilled information (concepts that stand the test of time and rigorous analysis) and less undistilled information (the news, reactionary opinions, and “cutting edge” research).

There is nothing wrong with losing. The problem is losing more than you plan to lose. You need clear rules that limit your downside. (“If any investment loses one million dollars then our firm sells immediately.”)

Much of what is randomness is timing. The best strategy for a given time period is often not the best strategy overall. In any given cycle, certain places will be dangerous, certain trading strategies will be fruitful, etc.

If you find yourself doing something extraordinarily well in a random situation, then keep doing what's working but limit your downside. There is nothing wrong with benefitting from randomness so long as you protect yourself from negative random events.

Randomness means there are some strategies that work well for any given cycle (an extreme fad diet), but these cycles are often short to medium term successes. More importantly, the strategies that work for a given cycle in the short term may not be the best for long run. They are sub optimal strategies winning over a randomly beneficial short term cycle. The same can said for setting huge goals, following a fad diet, chasing an extreme training protocol, and so on. Unsustainable and suboptimal for the long term. In this way, evolutionary traits that are undesirable can survive for a period of time in any given population. That is, suboptimal strategies and traits can seem desirable in the short run even though they will be resoundingly defeated in the long run.

Important point: you can never affirm a statement, merely confirm its rejection. There is a big difference between “this has never happened” and “this will ever happen.” You can say the first, but never truly confirm the second. It just takes one counter example to prove all previous observations wrong. We never know things for sure, only with varying degrees of certainty.

There are only two types of ideas. Those that have been proven wrong and those which have yet to be proved wrong. (Feynman said something similar.)

Strive to become a man of leisure who can afford to sit with ideas, think properly about them, and gradually provide something of value.

Science is speculation. This is important to remember. Scientists are simply creating well-formed and well-educated conjectures about the world. But they are still conjectures that can be proved incorrect by one random event.

It's a difficult standard to demand that you can actually implement ideas and not merely share them (there have been many brilliant philosophers and scientists who have had great ideas they didn't personally use), but is an idea really that great if you can stick to it? Obviously, everyone has different skills and circumstances, so maybe someone can use your idea even if you can't. But generally speaking, I think you should be able to live out the ideas you share.

Pascal: “the optimal strategy for humans is to believe in the existence of God. For, if God exists, then the believer will be rewarded. If God does not exist, the believer will have nothing to lose.” My first thought: “yes, but what if you believe in the ‘wrong' God?” Should you play a numbers game and believe in the God most people believe in? Or, can we safely assume that of the infinite number of possible Gods humans could have designed it is unlikely that any of the ones we worship are actually the God? So, just believe that a higher power exists? Whew. Tough call here.

Social treadmill effect: you get rich, move to a better neighborhood, surround yourself with more successful people, and feel poor again.

“Remember that nobody accepts randomness in his own success, only his failure.”

Skewness and expectations: you can't just look at the odds of something happening, but also the payoff you receive if it works (and the cost of it failing). A bet on something very unlikely can be smart if the payoff is large and you have rules to limit the many small losses that are likely.

Minor stalemates in life can often be solved by choosing randomly. In many cases it doesn't really matter so long as you choose something and move forward.

We follow rules not because they are the best options, but because they make things fast and easy.

Humans are inherently flawed. The cognitive biases that we have are simply a result of how our brains work. Sometimes these biases help us rather than hurt us. But they are always a result of how we are built. That makes them particularly difficult to avoid.

We seem to focus too much on “local” changes, not global ones. That is, we care too much about the latest change rather than the overall trend.

“Wealth does not make people happy, but positive increases in wealth may.”

We do not think, but use heuristics to make decisions.

Emotions are “lubricants of reason.” We actually need to feel things to make decisions.

Emotions give us energy and they are actually critical to life in the day-to-day world. In other words, the goal here is not to become a robot who can analyze everything with perfect logic.

Even if you know about randomness and cognitive biases, you are still just as likely to fall victim to them.

How to overcome these biases? We need tricks. We are just animals and we need to re-structure our environment to control our emotions in a smart way.

“Most of us know pretty much how we should behave. It is the execution that is the problem, not the absence of knowledge.”

“I try to remind my group each week that we are all idiots and know nothing, but we have the good fortune of knowing it.”

Do not blame others for your failures. Even if they are at fault.

The only aspect of your life that fortune does not have control over is your behavior.

Repetitiveness is key for determining if you are seeing skill or randomness at play. Can't repeat it? Not skillful.

“We favor the visible, the embedded, the personal, the narrated, and the tangible. We scorn the abstract. Everything good — aesthetics, ethics — and wrong — fooled by randomness — with us seems to flow from it.”

[clarencenicholsonata]

7 Home Seller Mistakes To Avoid When Choosing A Real Estate Agent

7 Home Seller Mistakes To Avoid When Choosing A Real Estate Agent

7 Home Seller Mistakes To Avoid When Choosing A Real Estate Agent

When it’s time to sell your property, how do you go about choosing a real estate agent?

I’m sure there won’t be any problem in locating the nearest real estate agent!

Heck, that’s the easy part!

After all, you see real estate agent signages in every town, every neighborhood, and pretty much on every street corner!

However, deciding on choosing which real estate agent is something completely different!

Will he do a successful job of selling your property for the highest price, in the shortest period of time, and the least amount of inconvenience to you?

Most of us don’t normally get exposed to real estate agents too often, other than a few times in our lifetime.

Therefore, choosing a real estate agent might not be the most straightforward decision to make, wouldn’t you agree?

Yet, a vital part of the marketing process of your home is actually the selection of the right real estate agent!

In other words, choosing the wrong real estate agent will undoubtedly lead to financial & emotional headaches ahead!

When choosing a real estate agent, there are a number of major home seller mistakes to avoid, and I have lined them up for you:

Mistake 1: Choosing a Real Estate Estate Agent Who Offers The Lowest Commission

Choosing a Real Estate Agent With The Lowest Commission

Now that you’ve decided to sell your home, your next step will be to interview a number of real estate agents.

There are many agents out there who will undercut the competition by seriously lowering their commission, in an attempt to win the listing mandate!

“As a home seller, I’m saving money already, so why is that a bad thing?” you say.

Well, there are a few ways of looking at it:

Reduced commission means reduced marketing resources available to assist in getting your home sold. The potential marketing tools that agent suggested he’ll be using, will be substantially less than what a full commission agent could offer as part of his marketing strategy of your property. That’s a fair business conclusion, no?

Now, say this listing agent decides to go the route of heavily discounting the commission rate so he can get your property listed, how many buyer agents are likely going to be turned off once they find out how small their cut of the commission will be? Hence, it would financially benefit the buyer agent to take his client elsewhere and be paid a standard market going commission for the services provided. Let’s think how many buyer agents would get excited to work with your listing agent?

And, finally, aren’t you curious to know why the agent needs to lower his commission by that much just to get the listing mandate? When he drops his commission at a drop of a hat (thereby hurting his bottom line), how good will he be when it’s negotiation time on the price of your property? Thereby hurting your bottom line?! Does making this decision still make you warm and fuzzy at the thought of saving money?

Before signing up with the real estate agent who’s offering the lowest commission, please read the above again.

Hopefully, it will put his listing presentation in perspective versus what other real estate agents are bringing to the table when marketing your home.

Mistake 2: Choosing a Real Estate Agent Who Gives You The Highest Listing Price

Now that you’ve decided to go on the market with your (overpriced) property, odds are quite high that you will eventually sell your home at a price below the going market price.

One can truly not emphasize enough the importance of starting one’s marketing process with the correct asking price!

The first 3-to-4 weeks of marketing are crucial and if the asking price is too high, unfortunately, potential home buyers will simply not even consider your listing.

Never mind taking the time to go view it!

And, to be honest, why would they?

The property is out of their price range anyway!

Or worse, a lot of real estate agents might even use your overpriced property to bounce their educated home buyers off to more correctly priced properties.

“Now that we’ve seen what $500,000 gets you here, wait until I show you the next home which is marketed at exactly the same price. You’ll be blown away by the high finishes and many extra features!”

Is that how you want agents and buyers to do when they’re viewing your home?

I didn’t think so either!

Regardless how you look at it, the end result will be that the overpriced property will sit on the market for a much longer time.

And it will eventually sell at a much lower price than would have been achieved if only it was priced correctly from the start!

Now, let’s assume there’s actually this one buyer who decides to put in an offer!

Another unfortunate risk you’ll run with selling an overpriced property is that the banks will have trouble finding value during their appraisal; thereby limiting the finance amount for the buyer.

And, unless there is a bigger deposit to make up the difference, the deal is likely to fall through.

All this effort, time, stress and living in hope, just to see it all go to waste!

Being a home seller, you only have one chance to make a first impression!

And, sure, while one might be tempted to be choosing the real estate agent who suggested marketing your property at a higher price, please make sure to ask for proof of how that price was determined by means of a Comparable Market Analysis.

Check with the agent what is currently on the market with similar features as your property.

Having a look at the recent sales of similar homes in your area will give you, as the homeowner, a more realistic expectation regarding the likely sale price of your property.

Plus, it will immediately set the agent straight regarding the listing price he put forward.

Mistake 3: Choosing a Real Estate Agent Who Sold The Most Properties

I admit that this one might be somewhat counterintuitive!

One might be tempted to use the total number of properties sold as the sole measuring stick in choosing a real estate agent.

While the agent who only manages to sell a couple of properties last year, might not be your direct choice, the agent selling 50 properties in a given year should not immediately be the first choice either.

“Why?” you ask.

Bear with me: per Mistake 2 above, we now realize that the real estate agent who gives the highest listing price is probably going to get a lot of the listings.

Yet, it will become very evident that those overpriced properties aren’t selling (no kidding!) and will likely remain on the agent’s books for longer periods of time.

In other words, the number of properties that agent eventually sells versus renting the properties that he still has on the books will be quite low.

In real estate terms, they refer to it as the sales-to-listing ratio.

Who do you think to be the better agent: the real estate agent who sells 13 out of 15 listings or the agent who sells 20 out of 50 listings?!

Do yourself a favor and don’t go looking for the real estate agent who sold the most properties!

Rather have a look at how well the agent priced the property, how he suggested going about the marketing strategy, how his reactions were when you attempted to reduce his commission (ie test his negotiation skills) and of course, how his overall presentation and communication report was.

These skills will be very important when it comes to buyer negotiations!

Is the real estate agent’s overall service equivalent to the high sales figures?

Mistake 4: Choosing a Real Estate Agent Because He’s Family

Choosing a Real Estate Agent Just Because He’s Family

Selling your house is very serious business.

Most real estate agents will agree that there’s no one sales contract the same!

Every client has his/her specific requirements, needs, wants & wishes and all of this needs to be properly documented by both buyer and seller agents.

Therefore, it is very important that not only during negotiation but also at the time of closing, that legally, everything is correctly worded.

You might be uncle Jack or cousin Marie’s favorite, but when it’s time to dive into some intense negotiation sessions, and subsequent legal paperwork, if things were not to work out with the buyer(s), it might be tough to split the personal from the business angle of the property sale!

Will you or your relative be able to look past whatever may have gone wrong during the home selling process if the experience wasn’t the greatest?

By all means, I’m not claiming you should never be choosing a real estate agent just because they’re family!

But one’s decision to choose the relative should perhaps not be automatically assumed!

Whoever will eventually be marketing your home should be going through a fair interview process together with other interested agents, all vying for the listing agent job!

Let the best (wo)man win!

Mistake 5: Choosing To Interview Only One Real Estate Agent

It might be highly recommended to interview real estate agents from different agencies, as each agency will have its own strengths in marketing and servicing.

The respective agents will have their own tools and skills to bring to the table when proposing their marketing plan of your property.

If you only interview one agent, you would be not exposed to any of that.

As in a lot of other businesses, the 80/20 rule applies in real estate.

(If anything, it’s skewed even more dramatic as numbers of near 90/10 in certain real estate markets are more common).

In other words, the remaining 80-90% of agents will do whatever it takes to gain those relatively few remaining listings; even if it means exaggerating ‘a bit’ when it comes to the listing price.

As a non-real estate agent, this might hard to comprehend but believe me, it’s extremely frustrating to see that happening right before your eyes by the competing agents!

A lot of the time, the home sellers will have no idea what exactly is taking place there!

Let’s put it in context:

Say you’re only interviewing one real estate agent to list your property, you should then know that there’s an 80-90% probability that you will get one of the latter ones!

To get the listing mandate, these agents will tell you whatever you want to hear in order to get your business.

Is that the type of risk you want to run by interviewing just one real estate agent?

Mistake 6: Choosing a Real Estate Agent Without Checking His References

It always amazes me to see how little research home sellers do prior to choosing a real estate agent.

A lot of times, it seems that people spend way more time reading up on the latest reviews before buying that newest UHD TV than actually researching the real estate agent’s history, before hiring him!

And yet, the financial impact is easily 100 times bigger and will impact you for the next 20 years!

When choosing a real estate agent, besides looking at his listings, have you ever Googled his details, and tried finding him on Facebook, LinkedIn, or Twitter?

And did the social activity on those platforms coincide with the professionalism and service you expected?

Every real estate agent should be able to provide you, as the home seller, with a list of references.

Obviously, the trick will be to bypass the ones that were hand selected and made it on that list!

Why not ask the real estate agent details of the current listings he’s working on and ask him whether you can call or email a few of those clients?

You will very quickly find out how these recent clients rate the real estate agent’s professionalism and services throughout the property selling process.

Another somewhat sneaky way to find out how an agent behaves when he’s not around his sellers is to go ‘mystery shopping’.

Call him at his office, or stop by one of his showhouses or even have someone call for you, and enquire about a certain property where sensitive questions get asked (eg “What’s the lowest offer the owners will take for this home?“).

Will the agent divulge crucial information he should not have revealed?

Mistake 7: Choosing a Real Estate Agent Who’s Working Part-Time

Why do you think there’s such a high turnover of real estate agents?

Any 3rd party might look at their local real estate agent and believe he’s got a cushy life, driving around town all day with these buyers, doing a couple of seller presentations and signing the big sales contracts.

Selling real estate really can’t be that difficult, now can it?

Well, the question needs to be asked whether the real estate agent is doing this part-time or is full-time involved in the real estate business.

Let’s be serious: how could a part-time real estate agent possibly be flexible enough doing all these buyer viewings?

And if he’s doing it part-time, how long will it take before clients get a response back to their inquiries?

Or worse, how quickly will the agent be able to show those clients the property?

What will be the timing of the marketing of the property? After hours? Weekends?

Finally, where do you as the home seller fit into this schedule?

Overall, the work that is involved in managing the listing, marketing it, giving it the much-needed exposure, writing offers, and finally, selling it & bringing it to a successful close, demands the attention of a full-time real estate agent!

Closing thoughts

You did perhaps not realize how many mistakes a home seller can make when choosing a real estate agent, and how easily it can sometimes be to be making them!

If there’s one thing I would like you to take away from this article, it definitely should be to avoid THE biggest home seller mistake of overpricing your property.

As you may slip through the cracks with the other home seller mistakes when choosing a real estate agent and not necessarily experience a professional home selling service, in the end, at the right price, at least your property will be sold!

Please apply the above information to avoid home seller mistakes when choosing a real estate agent!

Who knows, it might result in, not only in saving you thousands, but also avoid unnecessary emotional drama!

Additional Resources on Choosing a Real Estate Agent:

Home Sellers: Expect More From Your Realtor via Karen Highland

20 Cold, Hard Facts In Real Estate Home Selling via Lynn Pineda

Top Home Seller Mistakes When Selecting A Realtor via Maximum Real Estate Exposure

5 Tips To Selecting The ‘Right’ Real Estate Agent To Sell Your Home via Kyle Hiscock

If you found this article on home sellers mistakes when choosing a real estate agent to be an interesting read, please share it across your social media!

Have you been thinking about selling your home in Johannesburg, South Africa? I would love the opportunity to personally explain what the entire process entails, and more importantly, what top real estate agents such as myself will bring to the table to assist you when selling your home! 

Excited about selling your home yet? I am already excited for you! 

Let’s start a conversation today!

Editor’s Note: This post was originally published in December 2015 and has been revamped and updated for accuracy and comprehensiveness.

About the author: The above article “7 Home Seller Mistakes To Avoid When Choosing A Real Estate Agent” was written by Xavier De Buck, your top-producing Johannesburg real estate agent with Luxury Division of Chas Everitt International Group. Xavier has been nationally recognized and awarded for providing service excellence, exceptional property sales, whilst exhibiting the highest level of professionalism. With over 15 years combined experience as a real estate agent and real estate investor, if you’re thinking of buying or selling a home in Johannesburg, Xavier would love to share his property knowledge and expertise.

Xavier has more than 60,000 followers on Facebook, Google Plus, Twitter, Pinterest, Instagram and LinkedIn.

Make sure to connect!

© 2015-2017, Xavier De Buck. All Rights Reserved.

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[claythonplaza]

7 Home Seller Mistakes To Avoid When Choosing A Real Estate Agent

7 Home Seller Mistakes To Avoid When Choosing A Real Estate Agent

7 Home Seller Mistakes To Avoid When Choosing A Real Estate Agent

When it’s time to sell your property, how do you go about choosing a real estate agent?

I’m sure there won’t be any problem in locating the nearest real estate agent!

Heck, that’s the easy part!

After all, you see real estate agent signages in every town, every neighborhood, and pretty much on every street corner!

However, deciding on choosing which real estate agent is something completely different!

Will he do a successful job of selling your property for the highest price, in the shortest period of time, and the least amount of inconvenience to you?

Most of us don’t normally get exposed to real estate agents too often, other than a few times in our lifetime.

Therefore, choosing a real estate agent might not be the most straightforward decision to make, wouldn’t you agree?

Yet, a vital part of the marketing process of your home is actually the selection of the right real estate agent!

In other words, choosing the wrong real estate agent will undoubtedly lead to financial & emotional headaches ahead!

When choosing a real estate agent, there are a number of major home seller mistakes to avoid, and I have lined them up for you:

Mistake 1: Choosing a Real Estate Estate Agent Who Offers The Lowest Commission

Choosing a Real Estate Agent With The Lowest Commission

Now that you’ve decided to sell your home, your next step will be to interview a number of real estate agents.

There are many agents out there who will undercut the competition by seriously lowering their commission, in an attempt to win the listing mandate!

“As a home seller, I’m saving money already, so why is that a bad thing?” you say.

Well, there are a few ways of looking at it:

Reduced commission means reduced marketing resources available to assist in getting your home sold. The potential marketing tools that agent suggested he’ll be using, will be substantially less than what a full commission agent could offer as part of his marketing strategy of your property. That’s a fair business conclusion, no?

Now, say this listing agent decides to go the route of heavily discounting the commission rate so he can get your property listed, how many buyer agents are likely going to be turned off once they find out how small their cut of the commission will be? Hence, it would financially benefit the buyer agent to take his client elsewhere and be paid a standard market going commission for the services provided. Let’s think how many buyer agents would get excited to work with your listing agent?

And, finally, aren’t you curious to know why the agent needs to lower his commission by that much just to get the listing mandate? When he drops his commission at a drop of a hat (thereby hurting his bottom line), how good will he be when it’s negotiation time on the price of your property? Thereby hurting your bottom line?! Does making this decision still make you warm and fuzzy at the thought of saving money?

Before signing up with the real estate agent who’s offering the lowest commission, please read the above again.

Hopefully, it will put his listing presentation in perspective versus what other real estate agents are bringing to the table when marketing your home.

Mistake 2: Choosing a Real Estate Agent Who Gives You The Highest Listing Price

Now that you’ve decided to go on the market with your (overpriced) property, odds are quite high that you will eventually sell your home at a price below the going market price.

One can truly not emphasize enough the importance of starting one’s marketing process with the correct asking price!

The first 3-to-4 weeks of marketing are crucial and if the asking price is too high, unfortunately, potential home buyers will simply not even consider your listing.

Never mind taking the time to go view it!

And, to be honest, why would they?

The property is out of their price range anyway!

Or worse, a lot of real estate agents might even use your overpriced property to bounce their educated home buyers off to more correctly priced properties.

“Now that we’ve seen what $500,000 gets you here, wait until I show you the next home which is marketed at exactly the same price. You’ll be blown away by the high finishes and many extra features!”

Is that how you want agents and buyers to do when they’re viewing your home?

I didn’t think so either!

Regardless how you look at it, the end result will be that the overpriced property will sit on the market for a much longer time.

And it will eventually sell at a much lower price than would have been achieved if only it was priced correctly from the start!

Now, let’s assume there’s actually this one buyer who decides to put in an offer!

Another unfortunate risk you’ll run with selling an overpriced property is that the banks will have trouble finding value during their appraisal; thereby limiting the finance amount for the buyer.

And, unless there is a bigger deposit to make up the difference, the deal is likely to fall through.

All this effort, time, stress and living in hope, just to see it all go to waste!

Being a home seller, you only have one chance to make a first impression!

And, sure, while one might be tempted to be choosing the real estate agent who suggested marketing your property at a higher price, please make sure to ask for proof of how that price was determined by means of a Comparable Market Analysis.

Check with the agent what is currently on the market with similar features as your property.

Having a look at the recent sales of similar homes in your area will give you, as the homeowner, a more realistic expectation regarding the likely sale price of your property.

Plus, it will immediately set the agent straight regarding the listing price he put forward.

Mistake 3: Choosing a Real Estate Agent Who Sold The Most Properties

I admit that this one might be somewhat counterintuitive!

One might be tempted to use the total number of properties sold as the sole measuring stick in choosing a real estate agent.

While the agent who only manages to sell a couple of properties last year, might not be your direct choice, the agent selling 50 properties in a given year should not immediately be the first choice either.

“Why?” you ask.

Bear with me: per Mistake 2 above, we now realize that the real estate agent who gives the highest listing price is probably going to get a lot of the listings.

Yet, it will become very evident that those overpriced properties aren’t selling (no kidding!) and will likely remain on the agent’s books for longer periods of time.

In other words, the number of properties that agent eventually sells versus renting the properties that he still has on the books will be quite low.

In real estate terms, they refer to it as the sales-to-listing ratio.

Who do you think to be the better agent: the real estate agent who sells 13 out of 15 listings or the agent who sells 20 out of 50 listings?!

Do yourself a favor and don’t go looking for the real estate agent who sold the most properties!

Rather have a look at how well the agent priced the property, how he suggested going about the marketing strategy, how his reactions were when you attempted to reduce his commission (ie test his negotiation skills) and of course, how his overall presentation and communication report was.

These skills will be very important when it comes to buyer negotiations!

Is the real estate agent’s overall service equivalent to the high sales figures?

Mistake 4: Choosing a Real Estate Agent Because He’s Family

Choosing a Real Estate Agent Just Because He’s Family

Selling your house is very serious business.

Most real estate agents will agree that there’s no one sales contract the same!

Every client has his/her specific requirements, needs, wants & wishes and all of this needs to be properly documented by both buyer and seller agents.

Therefore, it is very important that not only during negotiation but also at the time of closing, that legally, everything is correctly worded.

You might be uncle Jack or cousin Marie’s favorite, but when it’s time to dive into some intense negotiation sessions, and subsequent legal paperwork, if things were not to work out with the buyer(s), it might be tough to split the personal from the business angle of the property sale!

Will you or your relative be able to look past whatever may have gone wrong during the home selling process if the experience wasn’t the greatest?

By all means, I’m not claiming you should never be choosing a real estate agent just because they’re family!

But one’s decision to choose the relative should perhaps not be automatically assumed!

Whoever will eventually be marketing your home should be going through a fair interview process together with other interested agents, all vying for the listing agent job!

Let the best (wo)man win!

Mistake 5: Choosing To Interview Only One Real Estate Agent

It might be highly recommended to interview real estate agents from different agencies, as each agency will have its own strengths in marketing and servicing.

The respective agents will have their own tools and skills to bring to the table when proposing their marketing plan of your property.

If you only interview one agent, you would be not exposed to any of that.

As in a lot of other businesses, the 80/20 rule applies in real estate.

(If anything, it’s skewed even more dramatic as numbers of near 90/10 in certain real estate markets are more common).

In other words, the remaining 80-90% of agents will do whatever it takes to gain those relatively few remaining listings; even if it means exaggerating ‘a bit’ when it comes to the listing price.

As a non-real estate agent, this might hard to comprehend but believe me, it’s extremely frustrating to see that happening right before your eyes by the competing agents!

A lot of the time, the home sellers will have no idea what exactly is taking place there!

Let’s put it in context:

Say you’re only interviewing one real estate agent to list your property, you should then know that there’s an 80-90% probability that you will get one of the latter ones!

To get the listing mandate, these agents will tell you whatever you want to hear in order to get your business.

Is that the type of risk you want to run by interviewing just one real estate agent?

Mistake 6: Choosing To Ignore a Real Estate Agent’s References

It always amazes me to see how little research home sellers do prior to choosing a real estate agent.

A lot of times, it seems that people spend way more time reading up on the latest reviews before buying that newest UHD TV than actually researching the real estate agent’s history, before hiring him!

And yet, the financial impact is easily 100 times bigger and will impact you for the next 20 years!

When choosing a real estate agent, besides looking at his listings, have you ever Googled his details, and tried finding him on Facebook, LinkedIn, or Twitter?

And did the social activity on those platforms coincide with the professionalism and service you expected?

Every real estate agent should be able to provide you, as the home seller, with a list of references.

Obviously, the trick will be to bypass the ones that were hand selected and made it on that list!

Why not ask the real estate agent details of the current listings he’s working on and ask him whether you can call or email a few of those clients?

You will very quickly find out how these recent clients rate the real estate agent’s professionalism and services throughout the property selling process.

Another somewhat sneaky way to find out how an agent behaves when he’s not around his sellers is to go ‘mystery shopping’.

Call him at his office, or stop by one of his showhouses or even have someone call for you, and enquire about a certain property where sensitive questions get asked (eg “What’s the lowest offer the owners will take for this home?“).

Will the agent divulge crucial information he should not have revealed?

Mistake 7: Choosing a Real Estate Agent Who’s Working Part-Time

Why do you think there’s such a high turnover of real estate agents?

Any 3rd party might look at their local real estate agent and believe he’s got a cushy life, driving around town all day with these buyers, doing a couple of seller presentations and signing the big sales contracts.

Selling real estate really can’t be that difficult, now can it?

Well, the question needs to be asked whether the real estate agent is doing this part-time or is full-time involved in the real estate business.

Let’s be serious: how could a part-time real estate agent possibly be flexible enough doing all these buyer viewings?

And if he’s doing it part-time, how long will it take before clients get a response back to their inquiries?

Or worse, how quickly will the agent be able to show those clients the property?

What will be the timing of the marketing of the property? After hours? Weekends?

Finally, where do you as the home seller fit into this schedule?

Overall, the work that is involved in managing the listing, marketing it, giving it the much-needed exposure, writing offers, and finally, selling it & bringing it to a successful close, demands the attention of a full-time real estate agent!

Closing thoughts

You did perhaps not realize how many mistakes a home seller can make when choosing a real estate agent, and how easily it can sometimes be to be making them!

If there’s one thing I would like you to take away from this article, it definitely should be to avoid THE biggest home seller mistake of overpricing your property.

As you may slip through the cracks with the other home seller mistakes when choosing a real estate agent and not necessarily experience a professional home selling service, in the end, at the right price, at least your property will be sold!

Please apply the above information to avoid home seller mistakes when choosing a real estate agent!

Who knows, it might result in, not only in saving you thousands, but also avoid unnecessary emotional drama!

Additional Resources on Choosing a Real Estate Agent:

Home Sellers: Expect More From Your Realtor via Karen Highland

20 Cold, Hard Facts In Real Estate Home Selling via Lynn Pineda

Top Home Seller Mistakes When Selecting A Realtor via Maximum Real Estate Exposure

5 Tips To Selecting The ‘Right’ Real Estate Agent To Sell Your Home via Kyle Hiscock

If you found this article on home sellers mistakes when choosing a real estate agent to be an interesting read, please share it across your social media!

Have you been thinking about selling your home in Johannesburg, South Africa? I would love the opportunity to personally explain what the entire process entails, and more importantly, what top real estate agents such as myself will bring to the table to assist you when selling your home! 

Excited about selling your home yet? I am already excited for you! 

Let’s start a conversation today!

Editor’s Note: This post was originally published in December 2015 and has been revamped and updated for accuracy and comprehensiveness.

About the author: The above article “7 Home Seller Mistakes To Avoid When Choosing A Real Estate Agent” was written by Xavier De Buck, your top-producing Johannesburg real estate agent with Luxury Division of Chas Everitt International Group. Xavier has been nationally recognized and awarded for providing service excellence, exceptional property sales, whilst exhibiting the highest level of professionalism. With over 15 years combined experience as a real estate agent and real estate investor, if you’re thinking of buying or selling a home in Johannesburg, Xavier would love to share his property knowledge and expertise.

Xavier has more than 60,000 followers on Facebook, Google Plus, Twitter, Pinterest, Instagram and LinkedIn.

Make sure to connect!

© 2015-2017, Xavier De Buck. All Rights Reserved.

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[michaelpatrickhicks]

Review: MAD About Trump

My rating: 1 of 5 stars One of the things that makes satirizing Donald Trump so difficult is that no matter how low the bar for expectations are set, Trump always manages to fall short, repeatedly surprising us with how shallow, crude, and idiotic he actually is. Even when we think he cannot possibly manage to be any stupider, he proves us wrong, over and over and over. Trump is horribly flawed, to put it lightly, but usually in a predictable way. We know that if you stroke his ego, he'll promise you the greatest things, the best things, things you can only ever imagine, but the best things nonetheless. Call him a small-handed pussy-grabber whose breath reeks of rot and decay, and he'll still be sending you press clippings decades later arguing that his hands are not that small. And you know he'll be dedicating many a lonely hours tweeting ALL of it from his golden toilet. Even when we think he cannot possibly be stupid enough to undermine his own staff who are attempting to cover up whatever latest treasonous BS he's committed through his own ineptitude, he still manages to surprise us by being even dumber than we gave him credit for, but we kind of know it's coming anyway. In these ways, he's completely, utterly predictable. Unfortunately, MAD Magazine's effort at making light of and mocking such shortcomings are equally predictable and tiresome. Frankly, MAD About Trump: A Brilliant Look at Our Brainless President is not nearly as mean, cruel, derisive, or scathing as Trump deserves. It also doesn't feel particularly fresh, releasing in late June, our 8,976,349th year of Trump's reign. Too much of the magazine's attempts at humor are trite acknowledgments of how Trump actually behaves, and its attempts at caricature are nowhere near as outlandish a Trump himself. When one artist draws the orange buffoon trying to sneak into a pageant contestant's dressing room, we can only sigh with the sad realization that not only is it true, but that Trump-proper was also known for ducking into an underage girl's dressing rooms, as well. It's difficult to make light of his history as a sexual assailant and voyeurism of naked or scantily-clad children. The biggest problem with this issue of MAD Magazine is that it is utterly soft serve, a little league softball attempt at mockery, but one that is too often completely on the nose. Take for instance the poster about Besty DeVos's purchased cabinet post, or selections of Trump tweets, one of which includes his thoughts on Thanksgiving: "A great day to remember how the Indians welcomed the Pilgrims to America, but NOT Muslims or Syrian refugees. Smart!" Seriously - are we sure he hasn't actually tweeted that (and if he hasn't, can you honestly promise he won't?!). Or, "If you're committing hate crimes in my name, please stop. It's Thanksgiving, for God's sake! You can always pick it back up tomorrow!" Of course, the biggest inaccuracy in any of MAD's tweets from Trump are the lack of misspellings and shoddy grammar. Where this comic should be ripping Trump and his supporters 120 thousand brand new assholes, it instead settles for the obvious and more mundane aspects of Trump's character. Where are comics about the infamous pee tape, or a poster of Trump drenched in urine, fresh off a golden shower and ripe for use in Resistance protests? Where are the checklists of who will be covered under PutinCare and who won't be? (Rich white guys in the GOP: COVERED. Women and minorities: NOT COVERED). Instead, we get several cheap and weak spoofs of The Apprentice. The MAD writers chose simply to opt for the cheap, easy, and sometimes greasy, way out. Just like Trump himself. There are a few bright spots, though, even if they are really few and far between. The crap-to-quality ratio is decidedly skewed in favor of crap, but occasionally a few gems snuck past the editors here and there. The comparisons between a Trump press conference and a bus station bathroom are on point, and I got a few chuckles out of a one-page segment on the similarities and differences between him and Pope Francis. Trump's new presidential seal, which sees the eagle replaced with the Twitter logo, is pretty clever, as is a quick visual gag of Trump's hair mussed by his KKK hood, and a one-liner about our national anthem being replaced with its Russian counterpart. In fact, the half-page bullet points devoted to the silver linings of Trump's presidency are all pretty funny, and perhaps uncomfortably close to the truth... Another segment worth exploring, particularly in light of Evangelical support for Cheeto Hitler, is Trump vs. The Bible, which pairs Bible quotes against Trumpism, such as Leviticus outlawing incest against Trump talking about banging his daughter, or Proverbs 18:15: "An intelligent heart acquires knowledge, and the ear of the wise seeks knowledge," against Trump's "We won with poorly educated. I love the poorly educated." Trump's rewritten version of John Lennon's "Imagine" is also pretty remarkable, and maybe even the stand-out segment of the whole issue. I also have to give props to MAD for including a fake diploma from Trump's fake university that allows you fill in your name and frame for hanging. Friends and neighbors wouldn't even be able to tell the difference between this and the phony one! I also got a big laugh out of the similarities between Trump and Burger King's new Mac 'N Cheetos for noting that both look like an Oompa Loompa boner. That's a top-fucking-notch, spot-on observation. Scattered between all this are some movie poster spoofs that are Photoshopped pretty nicely, providing send-ups of Taxi Driver, Captain America: Civil War, and Die Hard. And even all this sounds much better than it actually is... Coming in at 132 pages, this comic is a massive failure, all things considered. While there are (literally) a couple clever gags and funny punchlines, I found most of the issue pretty humdrum, if not outright basic. I haven't read MAD Magazine in probably a good twenty-five years, but recalling my fondness for it in my youth, I figured if anybody deserved my attention for a Trump takedown, it was this particular title. Maybe I've simply outgrown MAD and its comedic stylings, or maybe Trump is too much of a real-life moronic cartoon villain to properly satirize. Just when you think you can take a comedic razor's edge to the man, he stoops ever lower still, proving that you have, once again, given him far too much credit. And that's the fundamental flaw in this issue - Trump is given far, far, far too much credit. Even when he's getting torn a new one, you know it's only a matter time before MAD's writers look like Nostradamus predicting Trump's next nation-ruining moment, even as pundits declare it to be the moment Donnie-boy really became president. There's a few biting segments worth a look, but the magazine overall is an unremarkable dud, particularly in light of far more scathing late night TV monologues from Stephen Colbert or John Oliver, or even the occasional Twitter account for that matter. Perhaps that's as it should be though. Trump is best known for his late-night twitter rants and celebrity TV shows. If he's to be taken down on any battlefield, it'll be online or on television, not in books he'll have never heard of and won't be bothered to read regardless of how many pretty pictures and illustrations may be inside. [Note: I received an advanced copy of this title from the publisher via NetGalley.] View all my reviews