George Soros May be Bullish - Caution Masters

Minyanville.com has a good article on Soros' recent bullish comments but digs into why you should question his position and more important, how to play it and what to keep in mind with investing your own money.  Our favorite idea "the importance of not losing money in the first place", enjoy the article.

Most important take away points and what to keep in mind when trading your own cash:

So if you’re a savvy investor, what steps can you take to translate moves being made by 3 of the best investors of our time into profits of your own?

1. A good place to start is by taking the time to understand precisely what drives these guys. Even though superficially they're different -- Rogers hunts for opportunities around the world, Soros tends to pursue investment plays involving currencies and macroeconomic trends, and Buffett's a deep-value guy -- they have much more in common than you think. That’s especially true since the core elements of the strategies these 3 investors use to win and profit usually run counter to Wall Street’s conventional wisdom.

2. Take the very concept of profits, for example: Most people are surprised to learn that none of these gentlemen spends the morning rubbing his hands together and cackling over how much money he’s going to make that day. But nearly all have gone on record at one point or another about the importance of not losing money in the first place. They’ve also repeatedly stressed the importance of waiting until the really compelling opportunities develop before putting money at risk.

Rogers, once Soros’ partner at the Quantum Fund -- a hedge fund that’s often described as the first real global investment fund -- goes a step further: He describes his investment process as waiting until somebody puts money down in the corner, then “walking over and picking it up.”

3. Moreover, none of these 3 investors believes you have to take big risks to make big money. In fact, all 3 believe, as I do, that it’s how you concentrate your wealth that matters.

This flies in the face of what Wall Street would have you believe, which is that you need to diversify your assets to get ahead. Diversification as Wall Street practices it is a complete misuse of the math and a proxy for an entire establishment that doesn’t know what it’s doing.

The thinking is that by spreading your money around willy-nilly, some of your holdings will rise in value, even as other parts of the portfolio fall. Even so, by diversifying, Wall Street says that you'll be better off for it over the long run.

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 The bottom line is that Soros, Buffett, and Rogers have demonstrated time and again that they’ll only make a move when they’re darned good and ready -- when they’ve done all they can to scope out the situation at hand, and to make sure that the percentages are in their favor

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There’s one final thing these guys do better than almost anyone: Keep everything in perspective. They assemble their portfolios with diligent planning, attention to detail, and an emphasis on the objectives they expect to achieve. They make investments based on a clearly defined set of expectations and don't hesitate to cut their losses if they find out they were wrong.

Read the Article - Click Here

SOURCE: http://www.minyanville.com/articles/RIO-rig-cien-EWZ-gsf-irf/index/a/23369/p/1