CV: Release Notes

Version 3

There had been many changes and two new chapters were added. The practical limit of the size of this book is about 500 pages (6*9). A lot of non-essential information (most in the Afterthought section) was moved to the web site for this book.

Some chapters were re-written so they will not depend on frequent updates (such as the prediction of 2014 market). The readers should use the same logics in making better predictions for the coming years.

Tony

1/2014

P.S. From 6/2013 on, trades in the Momentum portfolio will be scattered among many accounts. It has been too restrictive on me in one account and I’m taking advantage of low or free commission fees for this trade-heavy portfolio.

Version 2

The first edition is actually my development version. Surprisingly many copies have been sold. I have received many excellent feed backs and I’m grateful. The most recent one that made my day is:

“Tony, I used to use tarot cards (in investing), until I read your fact infested book Debunk the Myths...”

“Tony, Great work!” from James and Chris, who are portfolio managers.

My book depends on your word-of-mouth advertising. If you feel it is useful, mention it in forums, social media, or write a review in amazon.com (http://www.amazon.com/dp/B00CLCKX52 or click here).

Conventional wisdom for today’s investors

Most ideas from the first edition are quite original. I tried to add ideas from several classic books to enrich this book. I failed. I started with a classic book that was written many decades ago. Roughly speaking, 30% of the ideas still work. However, most of these conventional wisdoms have been mentioned in this book already. The other 30% do not even work in today’s market. The rest are only valid with modifications or under certain situations.

Most books have one theme and use many examples and data to substantiate the theme and ignore examples contradictory to the theme. On the contrary, I share my good and bad experiences and sometimes the bad ones benefit us more. I added a chapter (Chapter 130) on my bad experiences – not too many authors admit their mistakes.

Changes

Added 27 new chapters (not counting splitting one chapter into two) and updated many articles.

Videos are added to present some basic terms and strategies in investing. It adds another dimension to our traditional books. Many links are provided in the Link section of the article and they will be useful for hard-copy readers. Several chapters with related topics are grouped next to each other.

Proven Usefulness

This book deals with current topics applicable to the current market for retail investors. The seeds that fall on rich soil will bear fruits. They could be beneficial to your financial health only if you act on them and they are right for the current market conditions and your individual situation. Remember, it is your own money and no one will be responsible for your actions but you, so do your homework. Here are some samples that have been working in 2013 and most likely and hopefully they will continue working.

·         Sell all long-term bonds (Chapter 82).

·         Sell all municipal bonds (Chapter 83).

·         How to detect market plunges.

It worked for the last two big plunges (2000 and 2007) with plenty of time to react. Most likely it will work for the next plunge, but there is no guarantee that we have enough time to react to the next one (Chapter 48-50).

·         Many suggested strategies (Section IX). I hope the majority will beat S&P 500.

·         Tax avoidance (Chapter 87).

·         Diversification (Chapter 81).

A fund manager (no name please) got famous by predicting successfully the crash of 1987, but it also became her one-trick pony in predictions. Another book predicted the housing crash successfully, but its other predictions have not been materialized as of this writing. My point is: Predictions are just predictions, so do not follow the predictors blindly even those (myself included) with good records.

This book provides you with the knowledge and tools to deal with the next market plunges (Chapter 50) and take advantages of any opportunities that arise. I do not guarantee whether they will work again. Even if they do not work, this book would provide you with knowledge that should help you make better educated predictions.

Friends and enemies

Writing and promoting a book could make a lot of enemies. My articles on hedge funds, Buffett and investment newsletters would offend a lot of fund managers, subscription service providers, etc. Same for articles on unions, government employees… Being honest has its price but the readers should benefit from my unbiased viewpoints. I did not know I have to make so many people angry at me in writing a book, so let me be a comedian or an entertainer in my next life. J

The best way to benefit from this book is to fit my ideas into your current situation. Do not commit money in any new strategy including the strategies described in this book. Try them out first with paper trading and move in with small monetary commitments.

I hope this new edition will benefit your financial health.

Thanks to Norman and Sam for their constructive comments in this edition and proof read this book without any compensation.

Thanking you for ordering this book and many friends for previewing this version,

Tony

September, 2013

P.S. All the performance of my trades mentioned in this book is from my largest taxable account. The only exception is my momentum strategy which is primarily used in my Roth IRAs. 2013 so far is a great year for the market, so my great returns will not be sustainable. Tony.